MR MONEY BAGS: Finance minister Iipumbu Shiimi. PHOTO: File
MR MONEY BAGS: Finance minister Iipumbu Shiimi. PHOTO: File

Tax bonus saves fiscus

Big promises for election years
Billions more in tax collections allowed the minister of finance to fund big spending without increasing the deficit or debt burden.
Jo-Maré Duddy
Bigger income and higher disability grants as well as promises of tax breaks and increased monthly state pensions marked finance minister Iipumbu Shiimi’s mid-year budget review yesterday, as he pumped total expenditure for 2022/23 up by nearly N$4 billion.

“The primary focus of fiscal policy in the near- to medium-term is to shield the economy from the impact of the spike in international energy and food prices,” Shiimi said, referring to the devastating spill-overs stemming from Russia’s invasion of Ukraine.

The minister could afford being generous, as revenue estimations for the current fiscal year increased by about N$4.4 billion to N$64.1 billion, mainly on the back of corporate tax of mining and non-mining companies, stronger income tax collections, value-added tax and dividends.

This windfall also allowed Shiimi to lower the deficit forecast from nearly N$11.1 billion to about N$10.6 billion.

Total debt for 2022/23 is estimated at nearly N$138.4 billion, down from about N$140.2 billion in the main budget tabled in March.

Grants to increase

The total operational budget now stands at nearly N$60.1 billion compared to the N$56.6 billion in the main budget. Of this, about N$1.25 billion is for the salary increases of civil servants agreed to recently to avert a nationwide strike.

In addition, N$747.4 million more of personnel expenditure was granted, the bulk of which will go to health and social services as well as education, arts and culture to cater for projected shortfalls on recruitment.

Also included is N$5.2 million extra so the ministry of gender equality, poverty eradication and social welfare can increase the monthly conditional income grant for former food bank recipients from N$500 to N$600, effective this month.

Additional funding of N$97 million has been incorporated to increase the disability grant for beneficiaries under the age of 18 from N$250 to N$1 300. This will only become effective in the 2023/24 budget year.

Provision has also been made to increase the monthly old age grant and the disability grant, as well as the orphan and vulnerable children grant by N$100 effective in 2023/24, “should resources permit”, Shiimi said.

Tax breaks

The tax rate for non-mining companies will be reduced by two percentage points over the two outer years of the next medium-term expenditure framework. The rate will be reduced to 31% effective in 2024/25, with a further reduction to 30% in 2025/26.

Shiimi said the finance ministry will undertake an assessment of the consideration to increase the threshold for income tax on individuals from the current N$50 000 to N$100 000, with a view to provide relief to low-income earners.

The Income Tax Amendment Bill contains proposals for increasing the deductibility on pension fund contributions and educational policy deductions to a maximum of N$150 000, and provisions for thin capitalisation rules, amongst other things.

According to Shiimi, the Bill is currently with legal drafters, after which it will be tabled in the National Assembly this financial year.

The Value-Added Tax Amendment Bill is also before legal drafters before it is tabled this financial year.

It incorporates zero rating on the supply of sanitary pads, among other things, he said.

Operational expenditure

An amount of N$706 million has been allocated to the National Census to be undertaken in 2023/24.

A total of N$88 million is available for preparations for the presidential and national assembly elections in November 2024, as well as the regional councils and local authority elections in November 2025.

An additional N$531.1 million was granted to subsidies and other transfers to government organisations to cover, among other things, shortfalls on student funding at the Namibia Students Financial Assistance Fund (NSFAF) and the refurbishment of locomotives for TransNamib.

A total of N$872.9 million has been added on the goods and services budgets of various votes to cover – among other things - projected shortfalls on utilities, funding to combat the outbreak of foot and mouth disease and lung sickness, as well as to broadly stem the erosion of purchasing power in light of heightened inflation, particularly on transport, Shiimi said.

Capital projects

In contrast to previous years, the development budget was increased in the mid-year budget review.

The additional N$497.7 million will cater to outstanding invoices and potential shortfalls on critical ongoing projects to ensure continuity and avoid further penalties on road projects, the minister said.

Included in the extra money is N$33 million for defence under its classified research and development project. The Office of the President will receive an additional N$15 million to complete the Hosea Kutako shrine project.

Meanwhile, the massive land servicing programme will get N$75 million more, while N$25 million extra is earmarked for projects by the Namibia Industrial Development Agency (Nida).

Fisheries and marine resources, as well as higher education, technology and innovation each got N$10 million extra.

Works and transport received N$449 million more for road projects and to revamp the apron at the Hosea Kutako International Airport.

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Namibian Sun 2024-03-01

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H.E. Dr Nangolo Mbumba, President of the Republic of Namibia says they will continue to pursue the second struggle of Namibia Zambian President, Hakainde Hichilema said one road will be named after the late president in Lusaka and the other road will be named after the founding president of Namibia The late President Hage Geingob’s casket was stationed at the Eternal Flame before he was taken to his final resting place The casket will of the late president was lowered with a 21 gun salute Accoutrements will be handed over to the former first lady of Monica Geingos An official luncheon by invitation is scheduled to take place at 14:00 at the State House The foreign dignataries are currently paying their last tribute to the former first lady, Monica Geingos Heroes Acre will be closed to the public, the National Council will announce once it is reopenedSerieA: Internazionale 4 vs 0 Atalanta | Sassuolo 1 vs 6 Napoli FA Cup: Liverpool 3 vs 0 Southampton | Nottingham Forest 0 vs 1 Manchester United | Wolverhampton Wanderers 1 vs 0 Brighton & Hove Albion | Chelsea 3 vs 2 Leeds United | Blackburn Rovers 1 vs 1 Newcastle United | Luton Town 2 vs 6 Manchester City | AFC Bournemouth 0 vs 1 Leicester City Katima Mulilo: 18° | 36° Rundu: 18° | 37° Eenhana: 21° | 37° Oshakati: 23° | 37° Ruacana: 20° | 36° Tsumeb: 20° | 35° Otjiwarongo: 20° | 33° Omaruru: 21° | 35° Windhoek: 19° | 30° Gobabis: 21° | 34° Henties Bay: 18° | 22° Wind speed: 18km/h, Wind direction: S, Low tide: 12:25, High tide: 06:24, Low Tide: 00:25, High tide: 18:45 Swakopmund: 17° | 18° Wind speed: 24km/h, Wind direction: SW, Low tide: 12:23, High tide: 06:22, Low Tide: 00:23, High tide: 18:43 Walvis Bay: 18° | 23° Wind speed: 32km/h, Wind direction: SW, Low tide: 12:23, High tide: 06:21, Low Tide: 00:23, High tide: 18:42 Rehoboth: 20° | 32° Mariental: 25° | 35° Keetmanshoop: 24° | 34° Aranos: 24° | 36° Lüderitz: 15° | 28° Ariamsvlei: 26° | 38° Oranjemund: 15° | 23° Luanda: 27° | 29° Gaborone: 19° | 38° Lubumbashi: 16° | 26° Mbabane: 14° | 32° Maseru: 17° | 32° Antananarivo: 17° | 22° Lilongwe: 18° | 27° Maputo: 21° | 35° Windhoek: 19° | 30° Cape Town: 19° | 23° Durban: 17° | 29° Johannesburg: 18° | 33° Dar es Salaam: 26° | 32° Lusaka: 16° | 29° Harare: 15° | 31° Currency: GBP to NAD 24.11 | EUR to NAD 20.68 | CNY to NAD 2.67 | USD to NAD 19.1 | DZD to NAD 0.14 | AOA to NAD 0.02 | BWP to NAD 1.34 | EGP to NAD 0.61 | KES to NAD 0.13 | NGN to NAD 0.01 | ZMW to NAD 0.8 | ZWL to NAD 0.04 | BRL to NAD 3.85 | RUB to NAD 0.21 | INR to NAD 0.23 | USD to DZD 134.5 | USD to AOA 828.51 | USD to BWP 13.77 | USD to EGP 30.85 | USD to KES 145.48 | USD to NGN 1543.58 | USD to ZAR 19.13 | USD to ZMW 23.55 | USD to ZWL 321 | Stock Exchange: JSE All Share Index 72204.56 Down -1.28% | Namibian Stock Exchange (NSX) Overall Index 1504.77 Down -1.33% | Casablanca Stock Exchange (CSE) MASI 13031.16 Down -0.78% | Egyptian Exchange (EGX) 30 Index 28964.41 Up +0.30% | Botswana Stock Exchange (BSE) DCI 9009.48 Same 0 | NSX: MTC 7.75 SAME | Anirep 8.99 SAME | Capricorn Investment group 17.34 SAME | FirstRand Namibia Ltd 49 DOWN 0.50% | Letshego Holdings (Namibia) Ltd 4.1 UP 2.50% | Namibia Asset Management Ltd 0.7 SAME | Namibia Breweries Ltd 31.49 UP 0.03% | Nictus Holdings - Nam 2.22 SAME | Oryx Properties Ltd 12.1 UP 1.70% | Paratus Namibia Holdings 11.99 SAME | SBN Holdings 8.45 SAME | Trustco Group Holdings Ltd 0.48 SAME | B2Gold Corporation 47.34 DOWN 1.50% | Local Index closed 677.62 UP 0.12% | Overall Index closed 1534.6 DOWN 0.05% | Osino Resources Corp 19.47 DOWN 2.41% | Commodities: Gold US$ 2 077.66/OZ UP +1.63% | Copper US$ 3.83/lb UP +0.34% | Zinc US$ 2 427.10/T DOWN -0.3% | Brent Crude Oil US$ 84.88/BBP UP +2.64% | Platinum US$ 884.38/OZ UP +0.63% Sport results: H.E. Dr Nangolo Mbumba, President of the Republic of Namibia says they will continue to pursue the second struggle of Namibia Zambian President, Hakainde Hichilema said one road will be named after the late president in Lusaka and the other road will be named after the founding president of Namibia The late President Hage Geingob’s casket was stationed at the Eternal Flame before he was taken to his final resting place The casket will of the late president was lowered with a 21 gun salute Accoutrements will be handed over to the former first lady of Monica Geingos An official luncheon by invitation is scheduled to take place at 14:00 at the State House The foreign dignataries are currently paying their last tribute to the former first lady, Monica Geingos Heroes Acre will be closed to the public, the National Council will announce once it is reopenedSerieA: Internazionale 4 vs 0 Atalanta | Sassuolo 1 vs 6 Napoli FA Cup: Liverpool 3 vs 0 Southampton | Nottingham Forest 0 vs 1 Manchester United | Wolverhampton Wanderers 1 vs 0 Brighton & Hove Albion | Chelsea 3 vs 2 Leeds United | Blackburn Rovers 1 vs 1 Newcastle United | Luton Town 2 vs 6 Manchester City | AFC Bournemouth 0 vs 1 Leicester City Weather: Katima Mulilo: 18° | 36° Rundu: 18° | 37° Eenhana: 21° | 37° Oshakati: 23° | 37° Ruacana: 20° | 36° Tsumeb: 20° | 35° Otjiwarongo: 20° | 33° Omaruru: 21° | 35° Windhoek: 19° | 30° Gobabis: 21° | 34° Henties Bay: 18° | 22° Wind speed: 18km/h, Wind direction: S, Low tide: 12:25, High tide: 06:24, Low Tide: 00:25, High tide: 18:45 Swakopmund: 17° | 18° Wind speed: 24km/h, Wind direction: SW, Low tide: 12:23, High tide: 06:22, Low Tide: 00:23, High tide: 18:43 Walvis Bay: 18° | 23° Wind speed: 32km/h, Wind direction: SW, Low tide: 12:23, High tide: 06:21, Low Tide: 00:23, High tide: 18:42 Rehoboth: 20° | 32° Mariental: 25° | 35° Keetmanshoop: 24° | 34° Aranos: 24° | 36° Lüderitz: 15° | 28° Ariamsvlei: 26° | 38° Oranjemund: 15° | 23° Luanda: 27° | 29° Gaborone: 19° | 38° Lubumbashi: 16° | 26° Mbabane: 14° | 32° Maseru: 17° | 32° Antananarivo: 17° | 22° Lilongwe: 18° | 27° Maputo: 21° | 35° Windhoek: 19° | 30° Cape Town: 19° | 23° Durban: 17° | 29° Johannesburg: 18° | 33° Dar es Salaam: 26° | 32° Lusaka: 16° | 29° Harare: 15° | 31° Economic Indicators: Currency: GBP to NAD 24.11 | EUR to NAD 20.68 | CNY to NAD 2.67 | USD to NAD 19.1 | DZD to NAD 0.14 | AOA to NAD 0.02 | BWP to NAD 1.34 | EGP to NAD 0.61 | KES to NAD 0.13 | NGN to NAD 0.01 | ZMW to NAD 0.8 | ZWL to NAD 0.04 | BRL to NAD 3.85 | RUB to NAD 0.21 | INR to NAD 0.23 | USD to DZD 134.5 | USD to AOA 828.51 | USD to BWP 13.77 | USD to EGP 30.85 | USD to KES 145.48 | USD to NGN 1543.58 | USD to ZAR 19.13 | USD to ZMW 23.55 | USD to ZWL 321 | Stock Exchange: JSE All Share Index 72204.56 Down -1.28% | Namibian Stock Exchange (NSX) Overall Index 1504.77 Down -1.33% | Casablanca Stock Exchange (CSE) MASI 13031.16 Down -0.78% | Egyptian Exchange (EGX) 30 Index 28964.41 Up +0.30% | Botswana Stock Exchange (BSE) DCI 9009.48 Same 0 | NSX: MTC 7.75 SAME | Anirep 8.99 SAME | Capricorn Investment group 17.34 SAME | FirstRand Namibia Ltd 49 DOWN 0.50% | Letshego Holdings (Namibia) Ltd 4.1 UP 2.50% | Namibia Asset Management Ltd 0.7 SAME | Namibia Breweries Ltd 31.49 UP 0.03% | Nictus Holdings - Nam 2.22 SAME | Oryx Properties Ltd 12.1 UP 1.70% | Paratus Namibia Holdings 11.99 SAME | SBN Holdings 8.45 SAME | Trustco Group Holdings Ltd 0.48 SAME | B2Gold Corporation 47.34 DOWN 1.50% | Local Index closed 677.62 UP 0.12% | Overall Index closed 1534.6 DOWN 0.05% | Osino Resources Corp 19.47 DOWN 2.41% | Commodities: Gold US$ 2 077.66/OZ UP +1.63% | Copper US$ 3.83/lb UP +0.34% | Zinc US$ 2 427.10/T DOWN -0.3% | Brent Crude Oil US$ 84.88/BBP UP +2.64% | Platinum US$ 884.38/OZ UP +0.63%