BARP wants pensions to be tax-free

By Jenique Belgrave 

The Barbados Association of Retired Persons (BARP) is urging the Government to stop taxing pensions.

The call came on Tuesday as the association welcomed the announcement by Prime Minister Mia Mottley in her Budget statement last week that the personal income tax allowance for pensioners will increase from $40 000 to $45 000.

BARP said while the measure will give pensioners some relief, it is also necessary for the Government to tackle the double taxation on pensions and to introduce a tax-free pension regime.

“BARP urges the Government to address the issue of double taxation on pensions received from approved pension plans which was brought about by the removal of the tax deduction for contributions paid to approved pension plans from income year 2015. We look forward to a tax-free future for pension income that would empower seniors to make meaningful home repairs, support medical care, contribute to financing the education of children and grandchildren, and make investments and charitable contributions less onerous,” the media release stated. 

The association noted that the reintroduction of the tax deduction will encourage employees and self-employed individuals to make contributions to pension plans and provide for their own retirement rather than relying solely on the funds of the National Insurance Scheme.

BARP said it was pleased with the Government’s decision to establish a working committee, which includes the Ministry of Finance, Central Bank, commercial banks, and other financial institutions, to implement recommendations for reverse mortgages in Barbados no later than January 2024.

The association said this was “an essential step towards unlocking equity in properties and supporting families in need”.

“BARP also welcomes the Government’s decision to initiate a partial principal repayment of $74.8 million to eligible bondholders of Series B Bonds, which will provide much-needed relief to these individuals, some of whom have died awaiting the returns on their investments following the debt default of 2018,”  the release added.

“BARP looks forward to working with the Government and other stakeholders towards building a brighter future for senior citizens in Barbados.” (JB/PR)