Finance Minister Iipumbu Shiimi has warned people against defaulting on their taxes saying that taxpayers must be made aware that tax does not discriminate and that all eligible taxpayers should ensure that they pay their taxes or risk facing the law.
Shiimi, during a Parliamentary session, responded to Namibians who voiced their frustration about high tax deductions while they are not eligible for benefits.
Taxpayers were fuming and said that they won’t pay tax since they do not benefit from it.
Shiimi said that the Namibia Revenue Agency is rounding up its compliance capacity and those found contravening the tax laws will be held accountable while reiterating that tax deductions will only be made from those who are eligible.
It was his stance that Namibians should be good law-abiding citizens.
“We are only able to build good schools and roads, amongst other things, because of tax collected,” he said.
The Minister called on Namibians to pay their share, adding that the law is the same for everybody and only those who cannot afford to pay tax are exempted.
Any individual who earns a taxable income in excess of N$5 000 that is not subject to PAYE (e.g. interest or profit from trade) is said to be required to register as a provisional taxpayer.
Meaning that a salary-earning individual earning an income of more than N$ 40 000 per annum and non-salary income in excess of N$5 000 per month is liable to pay tax, according to Namibia Payroll and Tax Overview.
Payments to Namibia’s Inland Revenue must be submitted by the 20th of each month. Payroll reports should be kept for a minimum of seven years.
Shiimi reminded also Parliamentarians that they too are beneficiaries of tax. For government to function and carry out its duties he urged them to honour this commitment.
By the end of February 2023, well before the end of the government’s financial year of 31 March, NamRa reportedly collected N$55 billion.
This impressive figure was confirmed by NamRA spokesperson Yarukeekuro Ndorokaze during a media engagement this year, where he warned those defaulting on their tax that the agency is hard at work to root out defaulters and it is only a matter of time before the law catches up with those evading paying tax, with hush penalties said to be constituted against taxpayer’s transgressors.
Namibia currently has a total of 887 500 registered taxpayers, with a 43 percent rate of non-compliance. In terms of taxpayer accounts, the bulk is from income tax with 768 369 people registered, constituting 86 percent.
During the tabling of the 2023/24 national budget, Shiimi said that by the end of January 2023, preliminary revenue outturn stood at N$56.2 billion, reflecting a collection rate of 87.8 percent over ten months.
In efforts to provide tax relief to low-income- earners, the government has resolved to introduce tax relief for individuals in the N$50 000 to N$100 000 tax bracket, effectively reducing their tax rate to zero, effective in FY2024/25.
“NamRA will continue with the final instalment of the tax arrears’ relief programme, whereby interest and penalties will be fully written off if outstanding capital is fully settled by 30 October 2024. This is the final extension of this programme, and we urge all concerned taxpayers to participate before the due date. Afterwards, there will be no more mercy,” warned Shiimi during his tabling of the national budget this year.