MATSAPHA:Textile companies situated in the densely populated Matsapha Industrial Site are at loggerheads with their employees,the bone of contention is alleged fraudulent and/or unlawful tax deductions.
Fashion International and other textile companies allegedly deduct Pay as You Earn(PAYE) from the salaries of the employees who earn a mere three thousand Rands(R3000.00),the amount deducted is between four hundred and seven hundred Rands(R700.00) and this, triggered tension last week as some employees protested.
Worth-noting, the textile workers are earning below the taxable threshold of three thousand four hundred and sixteen Rands, sixty seven cents(R3416.67),but tax experts told this publication that, those who might have worked an overtime and earned above the stipulated threshold are subject to taxation in terms of the tax laws.
“Our concerns now is that even if you earn below the threshold, you are taxed and even if the tax collected lawfully from those who earned above the threshold are taxed. We are not sure if these deducted monies are remitted to the Revenue Service,” said one of the aggrieved workers.
Reached for comments by this Swaziland News on Saturday,Ntobeko Dlamini, the Eswatini Revenue Service(ERS) Director Marketing and Communications clarified that, workers earning below E3,416.67 are exempted from Pay as You Earn but, those who received an overtime and allowances payments that resulted to the amount exceeding the threshold, are then taxed.
“The Eswatini Revenue Service(ERS) acknowledges the concerns raised regarding PAYE(Pay-As-You-Earn) deductions from textile workers’ salaries.We would like to provide clarity on this matter. The PAYE threshold is set at an annual income of E41,000.00 or approximately E3,416.67 per month.This means that any employee earning above this amount is subject to PAYE deductions.This threshold applies to total income derived from employment,which include basic pay, overtime,and any other allowances.This approach to PAYE is a worldwide standard for tax systems,” she said.
Marcia Hillary, a Manager at Fashion International avoided questions regarding the subject matter.
Wander Mkhonza is the Secretary General(SG) of the Amalgamated Trade Union Congress of Swaziland(ATUSWA), he told this Swaziland News on Saturday evening that, the confusion regarding the taxation has resulted to some textile workers protesting at Fashion International.
“While we are alive to the fact that, tax must be paid, there’s no clear formula within the textile companies regarding the threshold.I would make an example; it’s not fair to tax an employee just because he/she reached the threshold by working an overtime. We are currently engaging on this matter because employees are not happy at all”, said the ATUSWA Secretary General.
But Ntobeko Dlamini,the Eswatini Revenue Service Director-Communications further clarified that, to the best of her knowledge, textile companies “are lawfully collecting tax” and remitting same to the revenue service.
The Director subsequently dismissed the allegations suggesting that, some textile companies might be collecting tax unlawfully and, without remitting the money to the Revenue Service adding that, their records “indicates that, the collected tax is remitted” by the textile companies.
“Our records indicates that textile organizations have been diligently remitting PAYE deductions to the ERS, ensuring compliance with the country’s tax laws.These deductions are calculated based on the employees total earnings, and only individuals earning above the threshold are liable to PAYE. The ERS remains committed to fostering transparency and promoting understanding of the tax system. We encourage employees with concerns or questions about PAYE deductions to contact our offices directly for assistance”, said the ERS Director Marketing and Communications.
The Eswatini Revenue Service Headquarters.