Tax Incentives under Review for Credit Card Use
In order to encourage the use of credit cards as a means of making everyday transactions and increasing tax revenues, the government is considering exempting a portion of the income tax owing on the amount spent by cardholders.
A senior official of the Ministry of Finance and Economy (MOFE) said yesterday, ``We are considering incentives to make plastic a key means of doing business. One such incentive under review is to provide an income tax reduction for the amount consumers put on their cards.''
MOFE officials said this would greatly increase the public use of cards and help raise government tax revenues, which are expected to drop due to below-par corporate performance amid sweeping reforms this year.
The most likely form of tax reduction for credit card use would be a deduction of a portion of each consumer's income tax, the MOFE officials said, adding that the amount of the reduction would be decided upon within the framework of maximizing the incentive but minimizing the dent in tax revenues.
The MOFE said it will consult further with related economic government agencies in order to come up with detailed plans. …