The House of Representatives on Tuesday (December 10) passed the Transfer Tax (Amendment) Act, 2019, making permanent the two 2019/20 transfer tax revenue measures that were implemented in April.
The legislation was piloted by Minster of Finance and the Public Service, Dr. the Hon. Nigel Clarke.
In his remarks, Dr. Clarke explained that as part of the 2019/20 revenue measures, the rate of transfer tax was reduced from five per cent to two per cent on inter vivos transactions, and the threshold for the charging of transfer tax on death (estate of a deceased person) was increased from $100,000 to $10 million.
“Both measures are consistent with the Government’s thrust to increase economic growth and form part of a raft of measures which are aimed at stimulating greater competition and activity in and access to credit markets, greater business and economic activity, especially in the property development and real estate market, as well as to stimulate economic growth and job creation,” he stated.
The Minister noted that the measure in relation to death duties, is specifically targeted at assisting beneficiaries to leverage economic activities by allowing them to utilise equity in inherited properties.
Dr. Clarke informed that a Ministerial Order, under the Provisional Collection of Tax Act, allowed the measures to take effect on April 1, 2019, as was announced.
“However, the Act requires confirmation of the Order via the House and empowers the House to extend the six-month life of the Order for a further three months,” he stated.
He added that in compliance with that Act, “this House passed both Resolutions earlier this year, confirming it in the first instance and extending its effectiveness until December 31, 2019”.
“The Bill is seeking to amend the Transfer Tax Act to now give permanence to the reduction of the rate of transfer tax on inter vivos transactions and the increase in the threshold for charging of transfer tax on death,” the Finance Minister stated.
December 13, 2019
Written by Latonya Linton
Photo: Michael Sloley