Tax defaulters get lucky break
The incentive scheme aimed at recovering unpaid taxes has been extended to 3 April.
OGONE TLHAGE
Tax defaulters got another lucky break when the ministry of finance announced yesterday that it would be extending the Tax Arrears Recovery Incentive Programme, which was due to lapse on 11 March 2018.
The extension covers income tax, value-added tax (VAT), import, employee’s tax stamp duty, non-resident shareholders’ tax and tax on royalties.
The ministry of finance announced that the arrears programme, meant to encourage defaulting taxpayers to settle outstanding taxes, was extended to 3 April 2018. This marks the third extension of the incentive programme.
“The ministry of finance will waive the penalties levied in tax payments and submission of tax returns and write off 70% of the interest balance on all tax accounts for tax payers who pay the capital tax amount in full and 30% of the interest balance,” the ministry of finance said in a statement.
Namibia Chamber of Commerce and Industry northern branch chairperson Tomas Indjii said a reduction in government spending made it hard for small and medium enterprises to honour their tax obligations because of a reduction in revenue experienced by these businesses.
“Small and medium enterprises were keen to honour outstanding tax obligations to government,” he said. A reduction in government spending over the last two years made it difficult for tax defaulters to pay back, Indjii said.
“This lack of business has resulted in small and medium enterprises being unable to make payments based on the payment arrangements agreed upon, also of note is the festive season which has just passed, where most business close,” he said.
Indjii said an extension would help defaulters pay their tax obligations to the ministry of finance.
“We are requesting the ministry to further extend the deadline for registration and payment by another three to six months if possible. This would enable taxpayers, especially the ones that had already registered and started making payments, to pay off their instalments,” he said.
Iindji thanked businesses who were paying their taxes and encouraged business people in the country to visit the ministry of finance see if they had any tax obligations and to make arrangements to pay outstanding tax obligations.
Northern business people have been reported to be among the majority of tax defaulters in the country, Confidente reported in 2017.
Finance minister Calle Schlettwein said in 2017 that the taxpayer population for the ministry’s Oshakati Inland Revenue Regional Office contrasted vastly with the amount of tax paid in the north.
According to tax administration information, the Oshakati regional office has the second highest tax register in the country, after Windhoek, but in terms of tax collection, the northern office is said to be in fifth place out of the eight tax regions, according to Confidente.
Commenting on the matter, Iindji said that the data regarding northern businesses would need to be verified accordingly as most of the big businesses’ taxes were handled at the Large Tax Pay office in Windhoek Ausspannplatz and cases involving the non-payment of tax would be more prevalent at the Windhoek office.
Schlettwein noted that during the 2015/16 financial year, only N$36.8 million was collected by the northern office, while the total taxpayer register stood at 81 114, which equated to N$450 being collected from each taxpayer.
Out of the total number of taxpayers for the whole tax region, only 22 taxpayers are huge payers.
During the introduction of the programme in December 2016, Schlettwein has previously said the amount the government was owed had ballooned to N$19 billion from N$4 billion because of interest and penalties over the past 20 years. This means that the government will have to write off about N$15 billion in penalties and interest once the amnesty is put in place.
Tax defaulters got another lucky break when the ministry of finance announced yesterday that it would be extending the Tax Arrears Recovery Incentive Programme, which was due to lapse on 11 March 2018.
The extension covers income tax, value-added tax (VAT), import, employee’s tax stamp duty, non-resident shareholders’ tax and tax on royalties.
The ministry of finance announced that the arrears programme, meant to encourage defaulting taxpayers to settle outstanding taxes, was extended to 3 April 2018. This marks the third extension of the incentive programme.
“The ministry of finance will waive the penalties levied in tax payments and submission of tax returns and write off 70% of the interest balance on all tax accounts for tax payers who pay the capital tax amount in full and 30% of the interest balance,” the ministry of finance said in a statement.
Namibia Chamber of Commerce and Industry northern branch chairperson Tomas Indjii said a reduction in government spending made it hard for small and medium enterprises to honour their tax obligations because of a reduction in revenue experienced by these businesses.
“Small and medium enterprises were keen to honour outstanding tax obligations to government,” he said. A reduction in government spending over the last two years made it difficult for tax defaulters to pay back, Indjii said.
“This lack of business has resulted in small and medium enterprises being unable to make payments based on the payment arrangements agreed upon, also of note is the festive season which has just passed, where most business close,” he said.
Indjii said an extension would help defaulters pay their tax obligations to the ministry of finance.
“We are requesting the ministry to further extend the deadline for registration and payment by another three to six months if possible. This would enable taxpayers, especially the ones that had already registered and started making payments, to pay off their instalments,” he said.
Iindji thanked businesses who were paying their taxes and encouraged business people in the country to visit the ministry of finance see if they had any tax obligations and to make arrangements to pay outstanding tax obligations.
Northern business people have been reported to be among the majority of tax defaulters in the country, Confidente reported in 2017.
Finance minister Calle Schlettwein said in 2017 that the taxpayer population for the ministry’s Oshakati Inland Revenue Regional Office contrasted vastly with the amount of tax paid in the north.
According to tax administration information, the Oshakati regional office has the second highest tax register in the country, after Windhoek, but in terms of tax collection, the northern office is said to be in fifth place out of the eight tax regions, according to Confidente.
Commenting on the matter, Iindji said that the data regarding northern businesses would need to be verified accordingly as most of the big businesses’ taxes were handled at the Large Tax Pay office in Windhoek Ausspannplatz and cases involving the non-payment of tax would be more prevalent at the Windhoek office.
Schlettwein noted that during the 2015/16 financial year, only N$36.8 million was collected by the northern office, while the total taxpayer register stood at 81 114, which equated to N$450 being collected from each taxpayer.
Out of the total number of taxpayers for the whole tax region, only 22 taxpayers are huge payers.
During the introduction of the programme in December 2016, Schlettwein has previously said the amount the government was owed had ballooned to N$19 billion from N$4 billion because of interest and penalties over the past 20 years. This means that the government will have to write off about N$15 billion in penalties and interest once the amnesty is put in place.
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