Effective January 1, 2025, Belizean workers earning less than $29,000 annually will be exempt from paying income tax, Prime M i n i s t e r H o n . John Briceño announced during his State of the Nation Address.
"By increasing the income tax exemption threshold … to $29,000, an additional 2,851 workers will no longer be subject to income tax," Briceño stated, underscoring the g o v e r n m e n t ' s commitment to alleviating financial pressure on middle-income earners. Presently, Belize’s income tax system operates with a 25% flat rate on chargeable income, after applying personal relief. In Belize, income tax is calculated based on your total annual earnings, but before you’re taxed, a certain portion of your income is exempt from tax through a personal relief system. Given the personal relief structure, persons making less than $26,000 are essentially exempt from income tax. For those earning more than $26, $29,000 annually, the amount you can deduct gradually decreases. If your income is between $26,000 a n d $ 2 7 , 0 0 0 , your tax deduction is $24,600. If you earn bet w e e n $ 2 7 , 0 0 0 and $29,000, the deduction drops to $22,600. For everyone else making over $29,000 a year, the standard deduction is set at $19,600.
The announced change would essentially eradicate the tiers between $ 2 6 , 0 0 0 a n d $29,000, thereby, making income tax chargeable on persons whose incomes are above $29,000.
The Prime Minister further highlighted amendments to income tax laws aimed at correcting anomalies that previously led to reduced take-home pay when salaries increased. This adjustment, which will benefit approximately 733 workers, ensures t h a t e m p l o y e d individuals will not lose income as a result of pay raises.
Overall, the new income tax measures will inject over $3.3 million directly into the pockets of over 3,500 Belizean workers, according to Briceño.
In addition to the income tax reforms, Briceño announced new measures to reduce the cost of borrowing for small homeowners and businesses.
"All mortgages, assignments, and cancellations of mortgages for less than $100,000 will be exempt from stamp duty," the Prime Minister confirmed. This legislative change is expected to make financing more affordable and competitive among lending institutions, further supporting homeownership and entrepreneurship in Belize.
The government also introduced incentives to encourage private sector support for national development. A business tax credit of up to $30,000 or 1% of the tax liability—whichever is less—will be granted to donors who contribute to sports and educational initiatives in the country.
"To encourage p r i v a t e s e c t o r sponsorship and contribution to sports and educational development in Belize, a business tax credit will be available," Briceño emphasized during his address.
These reforms form part of the g o v e r n m e n t ' s b r o a d e r f i s c a l strategy to supp o r t B e l i z e a n workers and promote economic growth by easing the financial burden on taxpayers and stimulating investment in the country's development initiatives.
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