Today Andorran General Council (Parliament) has passed the bill on the implementation of individual income tax (IPRF) from January 1, 2015.
All the incomes of Andorran citizens, that exceed 40 000 euro (55 000 $) limit, will be taxed in accordance to 10% rate. The incentive rate of 5% will act in response to the incomes between 24 001 euro and 40 000 euro. Alongside with that certain tax benefits will be presented for families, for invalidity and for the acquisition of primary housing. Besides, the incomes on bank investments (no more than 3000 euro) also won’t be taxed.
In his speech to the legislators Andorran Minister for finances Jordi Cinca emphasized that a new law is aimed to favor economic diversification and to assure the stability of the budget. At that this law will allow to speed up the process of signing the agreements on the elimination of double taxation with the countries that are interconnected with Andorra economically and financially. In accordance to his words, such agreements will become the key for economic growth in the near future.
Andorran government didn’t support the initiative of social-democratic party deputy group; they offered to increase the tax rate up to 20% for those who earn 10 times more than minimum wages. In accordance to the Statistics Department, the average wages in Andorra made up 962 euro in 2013.