ORANJESTAD, Aruba – Minister of finance, economic affairs, and primary sector Geoffrey Wever, together with minister of tourism, transport, and labor Wendrick Cicilia and minister, of public health, social affairs, senior care and addiction care, Mervin Wyatt-Ras, received the support of the Council of Ministers to propose an amendment to the income tax law.
The proposed amendment introduces an additional tax deduction for pensioners aged 65 and older who remain active in the labor market.
As is well known, Aruba is currently facing a structural shortage of workers across various sectors. Our pensioners, with their wealth of knowledge and experience, can make a valuable contribution to addressing these shortages. However, at present, participation in the labor market is not particularly attractive for pensioners, as the additional income they earn on top of their pension often places them in a higher tax bracket.
The proposal presented to the Council of Ministers introduces an additional tax deduction of Afl. 10,000 for all individuals aged 65 and older who choose to continue working alongside receiving their pension.
This measure represents a concrete policy instrument that aims to achieve several positive outcomes:
- Increasing labor market participation among pensioners who wish to remain active;
- Enabling pensioners to continue contributing their knowledge and experience;
- Strengthening social engagement among older adults; and,
- Reducing pressure on the overall labor market.
Minister Geoffrey Wever explained:
“With this proposal, we offer our senior pensioners an opportunity to continue contributing and actively participating in our society. Their extensive knowledge, skills, and experience are of immense value to our community and the next generation, while also having a positive impact on our economy and labor market.”
Now that this fiscal incentive has been approved by the Council of Ministers of the AVP–Future Cabinet, the process to amend the income tax law will commence.