House Approves Changes to Asset Tax, Income Tax Acts

The House of Representatives has approved changes to two pieces of legislation to address a long-standing administrative issue relating to the operation of the income and asset tax systems and respond to the national emergency caused by Hurricane Melissa.

They are the Asset Tax Specified Bodies Amendment Bill and the Income Tax Amendment Bill, which provide for a limited adjustment to the annual filing and payment dates of both taxes, moving the final returns and payment dates from March 15 to April 15, starting with the 2025 year of assessment.

Piloting the Bills during the recent meeting of the Lower House, Minister of Finance and the Public Service, Hon. Fayval Williams, explained that they are intended to support workers during recovery, provide certainty to employers, improve administrative efficiency, and preserve the integrity of the tax system.

They reflect the Government’s commitment to fairness, compassion, and sound fiscal governance, she added.

The amendment to the Income Tax Act will facilitate non-taxable treatment of disaster relief support provided by employers to their employees following Hurricane Melissa.

It provides that disaster-related honoraria paid by employers to employees during the period from November 1, 2025 to March 3, 2026, will not be treated as taxable income in the hands of employees.

“At the same time, the bill allows such payments to be treated as deductible expenses for employers, provided they are genuinely borne by the employer and supported by appropriate documentation. The bill, therefore, corrects an outcome that would otherwise undermine the very purpose of the relief being provided. Mr. Speaker, it is important to emphasise that this relief is carefully bounded and does not represent an open-ended exemption,” Minister Williams explained.

She said that the measure is deliberately limited to a defined post-disaster period and is designed to operate only in the specific context of Hurricane Melissa recovery.

The framework includes a prescribed cap to be determined by the Minister to strike an appropriate balance between providing meaningful support to affected workers and maintaining the principled structure of the income tax system.

Tax Administration of Jamaica is empowered, through prescribed record-keeping and reporting requirements, to verify compliance with the relief, thereby safeguarding against abuse and ensuring transparency and accountability in its application.

Meanwhile, the Asset Tax Specified Bodies Amendment Bill advances a measured, administrative adjustment to the timing of corporate income tax filing and payment, an issue that has been under active policy consideration for several years.

It aligns the filing and payment dates for asset tax with the revised corporate income tax timeline, recognising that asset tax assessments are derived from the same underlying financial statements used for income tax purposes.

“This change is deliberately narrow in scope. It applies only to corporate income tax and asset tax and does not affect pay-as-you-earn individual income tax obligations or the existing quarterly estimated income tax prepayment schedule,” the Minister pointed out.

She said that the amendment is intended to reduce compliance pressure, improve administrative coherence and better align revenue realisation with fiscal planning, while remaining fully consistent with the Government’s overall fiscal framework.