Tax on host families (2)

I cannot understand all this fuss about taxing host families. I cannot imagine but a mere handful of these families earning in excess of the Lm3,100 tax free threshold allowed by the Income Tax Act.

If you take an annual gross income of Lm5,000, which is on the high side with regard to the income earned by host families, it can be easily proved that you need anything between 35 to 40 per cent of that income to feed the students up to the standards set by language schools. You are then left with about Lm3,250 from which you must meet the costs of water and electricity, maintenance of students' rooms, cleaning, laundry costs, the Lm60 MTA licence fee and depreciation of furniture.

You also have to buy heaters and fans, bed sheets, towels, etc. which you have to change practically every year or two.

I very much doubt that the resulting net profit will be much greater than Lm2,000. Language schools have been quoted as telling host families that this is a "tax free" activity.

Set in the above context they are perfectly right.