As the Dutch-speaking Caribbean Community (CARICOM) continues to feel the effects of an economic crisis, the Suriname government is considering raising the tax-free limit for workers.
President Chandrikapersad Santokhi said in a speech on Labour Day here on Monday that his administration wants to increase citizens’ purchasing power even as the economic situation worsens, in part due to cost-increasing measures implemented by the government as part of its structural adjustment program.
Santokhi stated in his speech that the government is considering raising the tax-free limit of SRD7,500 (US$200) and that 80,000 food packages will be handed to low-income workers soon.
“I want to emphasize that the distribution of food packages is only a stopgap measure.” It must be viewed in the context of an immediate short-term solution. We plan to take a more long-term and structural approach,” Santokhi added, noting that the government’s recently announced maternity and paternity leave will begin on May 2.
“Our country’s economic problems, as well as the influence and impact of the global economic crisis, which has not passed us by, have unfortunate consequences for every citizen in our beloved country.”
“The negative effects include unemployment and job insecurity, but also a labor shortage in certain sectors.” Furthermore, citizens must deal with declining purchasing power as a result of negative exchange rate developments on the one hand and necessary government cuts on the other,” Santokhi said.
He stated that the administration is aware that these “unwanted negative effects” are creating a fertile ground for an increase in poverty in the country, which is increasing uncertainty, particularly among the non-working people.
However, he stated that the situation has provided the government with an additional incentive to work to improve the welfare of workers and their families.
According to Santokhi, the government raised the poverty line for an adult to SRD 5,428 (US$140) in March of this year in order to take specific actions and implement programs aimed at long-term poverty reduction.
Based in part on this fact, the general minimum wage has been raised from 50% to 75%, equating to SRD30 per hour.
As of July 1, 2023, a general minimum wage of SRD35 per hour will be in effect, and Santokhi stated that the government is aware that the minimum wage level is insufficient, but that this is the amount that the economy can support.
He stated that the sales tax was repealed this year in order to enhance wage earners’ purchasing power, and that wage earners with taxable incomes less than SRD 7,500 (US$200) per month will be exempt from wage tax.
Santokhi stated that the recovery process, as well as the route to growth and sustainable development, are proceeding steadily, that the foundations have already been established, and that the government will continue on this path.
He stated that consultations with numerous stakeholders on the current socioeconomic crisis have taken place, and that the high cost of living and the reduction in purchasing power are among the main topics.
“We will pay more attention to these points of concern through dialogue in the various consultative structures such as the Social Economic Council, the Tripartite Consultation, and the various ministerial clusters,” Santokhi stated.
He stated that communication is also taking place with the labor movement in the quest of a just society, and that combatting poverty and enhancing the quality of life would be the government’s top focus in the coming months, in conjunction with the social partners.
Santokhi assured the public that the government’s employment policy would be centered on increasing productivity, developing labor skills, and strengthening Suriname’s international competitiveness.
He stated that the government had made monies available to boost community projects that provide underprivileged and at-risk kids with the opportunity to acquire a profession and become self-sufficient.
According to Santokhi, the government has begun to implement the third Decent Work Country Programme, which was developed in record time with technical assistance from the International Labour Organization (ILO) and has made Suriname the only country in the region with a third programme.
An essential component of this initiative is the encouragement of entrepreneurship as well as labor market productivity, which Santokhi claims will result in stronger enterprises in Suriname, increased employment, and higher wages for workers.
He stated that the goal is to create good jobs, boost investment, encourage innovation, and contribute to economic progress and prosperity.
