HOW MUCH ARE YOU LIKELY TO TAKE HOME? 30% BASE PAY INCREMENT TO REFLECT IN JANUARY SALARIES

By LKMensah

As you may recall, about some couple of weeks ago, Labor Unions and Government of Ghana upon a long tussle on salary negotiations sometime in November last year came to an agreement on a 30% rise in Base-pay for Public sector workers.

Checks indicates that the Controller and Accountant General has been directed to effect changes in payroll to reflect the increment in salaries for January.


The implementation of the 30% increment in Base pay would also mean that the 15% Cost of Living Allowance (COLA) which was approved in July, 2022 to cushion workers against the hash economic times would be taken off. So technically, what it again means is that pay rise is only by 15%.

Let me walk you through the calculations so you can be properly informed on how much exactly you should be expecting in your bank accounts at the end of the month. For example, if as at December, 2022 your Base pay was GHC2,056.31 then your new Base pay to reflect in January will be calculated as 30÷100 x 2,056.31 = 616.893

So the 30% increase would give you GHC616.893. Now add this to your December Basic pay of GHC2,056.31 and that would give you GHC2,673.203. (This amount is now going to be your new Base pay).


Now this how to calculate your market premium of 15%. 15÷100 x 2,673.203 = 400.980. If you add this to your new Base pay you'll be getting GHC3,074.183. This now becomes your total gross income.

To know your net income (i.e. take home salary), we have to deduct tax and social security from gross. But 5.5% will be calculated on your Base pay for SSNIT pension contributions. So 5.5÷100 x 2,673.203 = 147. 026. Your taxable income will now be 3,074.183 - 147.026 = 2,927.157. Income tax rate is 13.75%. 0.1375 x 2,927.157 = 402.484. Take 402.484 from 2,927.157 to get your take home salary of GHC2,524.673.

Information reaching me also indicates that public sector workers especially those in the Health and Education services will earn significantly more due to upgrades and promotions. In addition to their salaries, they will also be receiving arrears covering up to 3-4 months.


Having an idea about how much you'll be receiving at the end of the month as your take home salary, it is very vital to be frugal with how you spend this money, especially, seeing it is not something substantial. Times are hard and it doesn't appear to be soft anytime soon. Spend within your means to avoid any unnecessary pressure. Since affordability will increase on your pay slips bear in mind that interest rates on loans are also significantly high, therefore, if it's possible, do everything to avoid going for loans at this times.


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