News / National
'Bonuses would be taxed like ordinary salaries' says Chinamasa
10 Nov 2013 at 20:36hrs | Views
SOME companies have said they will pay their employees bonus using the normal taxation rates due to delays in the announcement of the 2014 National Budget while others will wait until the Budget is announced next year.
Finance Minister Patrick Chinamasa said he would delay the announcement of the budget to pave way for wider consultations.
The National Budget sets the tax threshold on bonuses and many companies only proceed with bonus payment after the tax-free threshold is announced in the budget statement.
Employers Confederation of Zimbabwe executive director Mr John Mufukare said they had agreed to pay bonuses using the normal taxation rates.
"Bonuses would be taxed like ordinary salaries pending the announcement of the budget," he said.
"When the budget is announced and we know how they should be taxed, the necessary adjustments will then be made."
Last year's tax free threshold for bonuses was US$1 000.
Confederation of Zimbabwe Industries president Mr Charles Msipa said he was still to get a clear position on the matter from his organisation's members.
"I will have to check on that and see how companies are approaching that matter," he said.
"But, if there is an expectation that the thresholds will change then obviously there will be delays in the payment of bonuses.
"Some may choose to wait until the budget is announced."
Mr Msipa said some private sector players normally paid their employees bonuses in January, while others paid them on performance-based basis.
Zimbabwe Teachers Union president Mr Richard Gundani said they had not been officially briefed on the situation.
"As you know, we have our channels of communication with Government and at the moment we have not been briefed on that," he said.
"We will meet urgently so that we get the official position from Government."
Zimbabwe Congress of Trade Unions secretary general Mr Japhet Moyo said his organisation was in the dark over the payment of bonuses.
"We do not know how the bonuses would be paid because we have not been informed of anything," he said.
"We are in the dark and the only information we have is what we are seeing in newspapers."
Minister Chinamasa told parliamentarians attending a pre-budget workshop recently that he would delay the announcement of the budget as he needed more time to consult stakeholders, but promised he would present it by January 2014 as required by the Constitution.
"We don't have a budget statement in November," he said.
"I need more time, possibly in December, but we will meet the constitutional requirement of doing it by January 2014."
Workers cannot wait to receive their bonus, which is often referred to as the 13th cheque, that is given by companies at the end of each year.
Finance Minister Patrick Chinamasa said he would delay the announcement of the budget to pave way for wider consultations.
The National Budget sets the tax threshold on bonuses and many companies only proceed with bonus payment after the tax-free threshold is announced in the budget statement.
Employers Confederation of Zimbabwe executive director Mr John Mufukare said they had agreed to pay bonuses using the normal taxation rates.
"Bonuses would be taxed like ordinary salaries pending the announcement of the budget," he said.
"When the budget is announced and we know how they should be taxed, the necessary adjustments will then be made."
Last year's tax free threshold for bonuses was US$1 000.
Confederation of Zimbabwe Industries president Mr Charles Msipa said he was still to get a clear position on the matter from his organisation's members.
"I will have to check on that and see how companies are approaching that matter," he said.
"But, if there is an expectation that the thresholds will change then obviously there will be delays in the payment of bonuses.
"Some may choose to wait until the budget is announced."
Mr Msipa said some private sector players normally paid their employees bonuses in January, while others paid them on performance-based basis.
Zimbabwe Teachers Union president Mr Richard Gundani said they had not been officially briefed on the situation.
"As you know, we have our channels of communication with Government and at the moment we have not been briefed on that," he said.
"We will meet urgently so that we get the official position from Government."
Zimbabwe Congress of Trade Unions secretary general Mr Japhet Moyo said his organisation was in the dark over the payment of bonuses.
"We do not know how the bonuses would be paid because we have not been informed of anything," he said.
"We are in the dark and the only information we have is what we are seeing in newspapers."
Minister Chinamasa told parliamentarians attending a pre-budget workshop recently that he would delay the announcement of the budget as he needed more time to consult stakeholders, but promised he would present it by January 2014 as required by the Constitution.
"We don't have a budget statement in November," he said.
"I need more time, possibly in December, but we will meet the constitutional requirement of doing it by January 2014."
Workers cannot wait to receive their bonus, which is often referred to as the 13th cheque, that is given by companies at the end of each year.
Source - Herald
