Finance Bill: Treasury to tax share ownership schemes for start-up employees

National Treasury and Economic Planning Cabinet Secretary John Mbadi.

Photo credit: Bonface Bogita | Nation Media Group

The Treasury has once again proposed to tax share ownership plans (ESOPs) for start-up workers, a move that is likely to dampen the prospect of growth for these firms through attraction and retention of talent.

ESOP is an employee benefit plan that gives workers ownership interest in the company in the form of shares of stock. The scheme is used to encourage employees to give their all as the company’s success translates into financial rewards.

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