New Tier in Levy Payment
In today’s broadcast, we will take some time to deal with the recent adjustments to the Housing and Social Development Levy. You will have heard the pronouncement by the Minister of Finance in the Budget Address for 2006. In that Address, he announced the establishment of a new tier in relation to the payment of Housing and Social Development Levy.
As you may be aware, Social Security is the collecting agency for the Levy on behalf of the Government. The Social Security Board has therefore obtained the relevant details from the Comptroller of Inland Revenue. The following press release was issued by the Board to inform all concerned so that when payments are being calculated the new structure will be taken into account.
The release states:
The St. Christopher and Nevis Social Security Board wishes to advise all employers and employees of the implementation of a new tier in the structure of Housing and Social Development Levy; effective January 2006. This change is in accordance with the provisions of the 2006 Budget Address presented by the Minister of Finance. There is no change in relation to the Severance Payment Contribution.
The Comptroller of Inland Revenue has provided details as follows:
Employer’s Contribution |
Employed Person’s Contribution |
Total Levy Contribution |
|
Earnings of less than $1000per month |
3% |
Nil |
3% of wages |
Earnings from 1,000.00 to 6,500.00 |
3% |
3% |
6% of wages |
Earnings from 6,500.01 to 8,000.00 |
3% |
8% |
11% of wages |
Earnings equal to or greater than 8,000.01 |
3% |
10% |
13% of wages |
Severance Payment (all wages/salaries) |
1% |
Nil |
1% of wages |
It is important to note:
- In relation to earnings between $6.500.01 and $8,000.00 per month, the employee will contribute to the Levy at the rate of 8% on that portion of wages, and
- In relation to earnings above $8,000.00 per month, the employee will contribute to the Levy at the rate of 10% on that portion of earnings
You will note that everything remains the same except where the person earns more than $8.000.00. In which case the portion of wages above $8,000.00 will be subject to 10% Levy.
For further clarification regarding the changes or regarding any other matters, kindly contact your nearest Social Security Office.
Before we leave you, I just want to take the time to pose a couple of questions to ponder about Social Security.
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Did you know that Social Security has just completed 28 years of operation in St. Kitts and Nevis? Yes, Social Security was started in 1978 as an income insurance fund taking over from the National Provident Fund which was basically a savings scheme. Compared to the Provident Fund, Social Security offers not only retirement incomes for life but also a host of other benefits as well.
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Did you know that Social Security contributes annually towards getting well needed equipment and special items for the Health Sector of the Federation? These donations are geared towards improving health care for all, promoting a healthy population. One such donation has just been made of equipment for use in the Operating Theater at the JNF Hospital.