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TAX DEBT AT 42% OF GDP TAXPAYERS OWE TREASURY N$56 BILLION

PHOTO: CONTRIBUTED

By: Nghiinomenwa Erastus

By the end of September 2021, registered taxpayers owe treasury N$56 billion in tax payable, interest and penalties.

The Namibia Revenue Agency (NamRA) revealed this on Tuesday during a media briefing.

The amount owed to the treasurer through tax payable, interest accumulated, and penalty imposed is equivalent to 42% of what Namibia collectively produces in goods and services a year.

A big chunk of the amount owed is in penalties (N$36 billion) imposed on taxpayers for different reasons relating to paying the payable amount.

Penalties have been imposed on 117 600 taxpayers.

Secondly, by September this year, 107 200 taxpayers owed the collector N$12 billion.

Using the time value for money, NamRa is also charging interest when a taxpayer does not settle their payment. In addition, by the end of September 2021, the taxpayers owed the collector N$8 billion in interest.

According to their assessment, those accumulating interest on their unmade payments is more than those with penalties, standing at 137 000 taxpayers.

According to NamRa, the country has 887 500 registered taxpayers- 86% are income taxpayers, while value-added tax and import duties constitute 8% of the tax base.

Those who pay other taxes are 4%, while registered employers are just 17 631(2%).

The agency did not reveal the reason for their default from citizens and companies.

It, however, highlighted that it is cognisant of the current economic environment and willing to work together with defaulters than forcing them to pay money they do not have due to economic conditions.

NamRa is still determined to collect N$49 billion and have indicated that they have already achieved 47% of the revenue target by the end of August 2021- by collecting N$23 billion.

Using budgetary allocation, the government uses most of the collected tax revenue to pay for critical public goods and services, pay for its debts and interest.

The government also gives subsidies to mostly non-commercial state-owned enterprises and also the non-growing commercial state-owned entities.

NamRa assesses and collects taxes and duties on behalf of the state. It also receives and records all State revenue on behalf of the government.

Moreover, improve service delivery to taxpayers, promote compliance with the revenue laws, and advise the minister on matters relating to tax administration.

Overall the agency has highlighted that the country has tax compliance issues, with only 57% of those eligible to pay taxes are compliant.

The agency promised awareness creation on why those eligible need to pay their taxes must do so.

At the same time, they indicated that they would bring in the police force to enable payment.

Email: erastus@thevillager.com.na

 

Julia Heita

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