The Cabinet Secretary presented the budget for 2016-17 to the National Assembly on 8 June 2016. Some of the proposed measures as regards direct taxation are given below:
Corporate taxation: Corporate tax rate decrease from 30% to 20% for developers who construct at least 1000 units per year.
Individual taxation: Bonuses, overtime and retirement benefits paid to workers who fall under the lowest income tax band are exempted from tax. Develop the tax bands and increase personal relief by 10%.
Other direct taxes: Resident withholding tax on rental income on the use of immovable property will be reduced from 12% to 10%. Gains made from the transfer of assets in the following circumstances will be exempt from capital gains tax: transfer of assets between spouses; transfer between former spouses as part of a divorce settlement or a separation agreement; transfer to immediate family; transfer to immediate family as part of a divorce or bona fide separation agreement; or transfer to a company where spouses or a spouse and immediate family hold 100% shareholding.
