The 2024 Budget espoused tax relief measures and proposed a review of the current legislation pertaining to employment. The article highlights the key measures for employees and their employers and anticipated changes that businesses should be aware of when dealing with their employees, regulators, and other stakeholders.
Pay As You Earn
As widely anticipated, the Pay As You Earn (PAYE) exempt threshold will be increased, and the top rate to 37% from 37.5% with effect from 1 January 2024. The changes, intended to provide relief to workers and increase their disposable income, are summarised in the table below:
| Current Regime | Proposed Regime | ||
| Income Band/month (ZMW) | Tax Rate (%) | Income Band/month (ZMW) | Tax Rate |
| 0 – 4,800 | 0% | 0 – 5,100 | 0% |
| 4,801 – 6,800 | 20% | 5,101 – 7,100 | 20% |
| 6,801 – 8,900 | 30% | 7,101 – 9,200 | 30% |
| Above 8,900 | 37.5% | Above 9,200 | 37% |
Employment Code: Looking Forward
The government seems to have grasped the nettle employers undergo dealing with the Employment Code Act, 2019 (ECA), which the Minister of Finance and National Planning, Dr Situmbeko Musokotwane (Minister), termed a ‘job killer’ because of the onerous financial obligations and conditions it imposes on employers. Thus, the Minister indicated that the ECA will be reviewed by the end of the first quarter of 2024 to drastically reduce the burden it imposes on employers.
It will be interesting to see what changes are made to the ECA in addition to the Minister’s suggestion that it be reviewed to, among other things, allow employers operating within MFEZs to have a distinct pay policy for workers based on agreed-upon principles of more pay for higher productivity.
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