Budget 2025 gives every family with two children, $1.8M of tax free income annually – Finance Minister

The Government of Guyana’s 2025 budget provides a suite of critical measures that ensures every family with two children is able to benefit from at least $1.8 million of tax free income annually. This perspective was recently underscored by the Senior Minister within the Office of the President with responsibility for Finance and Public Service, Dr. Ashni Singh.

During his presentation of the budget on January 17, the minister outlined a number of measures which will ensure greater financial empowerment of families. The minister recalled that in 2022, the Income Tax Threshold was increased from $65,000 to $75,000 monthly, then to $85,000 in 2023, following which, it moved to $100,000 in 2024. For 2025, the minister announced an increase of the threshold to $130,000 monthly. This he said represents a doubling of the threshold from the time his government entered office, adding, “This will result in an additional $8.5 billion in disposable income for workers and the removal of 22,000 persons from the tax net.”

The minister also noted that for those persons who earn overtime for work beyond their normal working hours, the first $50,000 monthly of their overtime would be non-taxable. For those who have a second job in addition to their full-time primary job, the first $50,000 of income earned monthly from their second job would be non-taxable. To further increase the disposable income of parents, the government will introduce a provision whereby, for each child, one parent would be allowed to claim $10,000 monthly of their income as non-taxable.

Minister Singh was keen to underscore the magnitude of these measures for a family with just one breadwinner and two children.

The legislator said, “The threshold was increased by $30,000 a month, that is $360,000 a year. You have the potential, if you earn $50,000 by way of overtime, every month you get tax free on that earnings, that is 600,000. If you have a second job and you are earning more than $50,000 and you claim relief, that is another $600,000 for a year. Let us now say you have two children in a family, you get $20,000 a month that is no longer taxed, and that times 12 is $240,000. So, a family that has one income earner, who has a fulltime and second job, a person who is able to claim for two children….together that is $1.8 million of tax free income in a year.”

Minister Singh said if one were to consider the budget 2025 measure that reduces the Personal Income Tax rate of 28 percent to 25 percent for employed and self-employed persons, that is an additional $600,000 per annum.

Overall, the minister said this comprehensive range of measures demonstrates that the government is dedicated to returning disposable income to people in a sustainable manner, while also acknowledging the economic realities of the day.

STRONG FOUNDATION

It should be noted that the foregoing measures stand on an already strong foundation of initiatives implemented by the government in the last four years to ensure families receive the support they need to thrive.

In 2021, it would be recalled that the Because We Care (BWC) cash grant was restored. This grant, together with the uniform grant, benefited public and private school students at a total cost of $27 billion over the period 2021 to 2024.

The government also increased the BWC grant per child annually from $15,000 to $40,000 over the last four years. During his 2025 budget presentation, Minister Singh stressed that the BWC Student Grant was increased to $50,000, benefiting over 205,000 children across public and private schools, placing an additional $2 billion into the hands of parents. Together with the BWC Student Grant, the uniform voucher allowance of $5,000 will result in parents of over 205,000 school children receiving a total of $55,000 per child, with an estimated $ 11 billion being transferred to parents and their children.

In 2022, the government also launched a National Breakfast Programme to provide meals for Grade Six pupils in the coastal regions. This programme was later extended to now benefit pupils from Grades Three to Six at all primary schools in Regions 2, 3, 4, 5, 6, 10 and Georgetown. Over the last four years, $10 billion was spent under this initiative, of which $4.9 billion was spent in 2024, and a further $5.5 billion was allocated to finance the programme in 2025. In January 2025, the government also abolished tuition fees at the University of Guyana and at state-run technical and vocational institutions. This initiative is estimated to benefit approximately 11,000 current students as well as all future students, at an annual cost of $13.4 billion.