Lifestyle audits kick off
07 November 2019 | Economics
The ministry of finance is gunning after suspected tax defaulters by means of lifestyle audits.
Tax commissioner Justus Mwafongwe told Namibian Sun that the campaign to recover unpaid taxes also involves visiting businesses to establish whether they have registered as taxpayers.
“We have started with lifestyle audits; we have a dedicated team of auditors that are focusing on lifestyle audits and there are some cases that we have already completed and actually collected some money,” said Mwafongwe.
“We are very much aware that there are high net-worth individuals who are probably not declaring the correct amount of income that they are earning, not paying the fair share of their contributions,” he said.
Mwafongwe was also asked to verify whether the ministry was succeeding in collecting outstanding taxes from businesses and individuals based in the north who had not been paying taxes.
Finance minister Calle Schlettwein said at an event hosted by the Namibia Chamber of Commerce and Industry that for the 2015/16 fiscal year, the ministry’s Oshakati office had collected only N$36.8 million from 81 114 taxpayers. That amounted to an average of N$450 per taxpayer.
In contrast, the Keetmanshoop office’s tax collection per taxpayer stood at N$1 527.
“It cannot be plausibly argued that the combined economic activities of the Oshakati region are significantly less than those of Keetmanshoop,” Schlettwein was quoted as saying.
Mwafongwe said there had been improvement in taxes collected in the north. The ministry was asked to give a breakdown of tax collection per tax office in January, but no response has been received yet.
“We were looking at the figures in terms of collections from the northern tax offices, there is an improvement,” Mwafongwe said.
“Even when you look at our targets given for that office, for the past two quarters they have actually met their targets so it’s an indication that there is an improvement in terms of compliance … but again, this is not to say we should now relax.”
According to him, there are compliance issues throughout the country and not only at the Oshakati office.
“There are still a lot of non-compliance cases, not only in the north but the whole country. The Integrated Tax Administration System (ITAS) will do wonders for us, but we need to continue with auditing activities, investigations and collections so that we make sure these people are compliant,” he said.