The fact that the Minister of Finance and Development Planning, Kenneth Matambo, did not propose tax amendments when delivering the budget speech on Monday does not mean there will be less tax collection during the year, a partner at Pricewaterhousecoopers (PWC) said on Tuesday.
Rudi Binedell from PWC said taxing is a way of give and take and as such he expects Botswana Unified Revenue Service (BURS) to continue collecting as much tax as possible by way of adopting several ways of maintaining tax collection.
Binedell was speaking the 2015/16 budget review hosted by FNB Botswana on Tuesday, a day after Matambo presented the budget speech for the upcoming financial year.
During his speech, Matambo revealed that total revenues and grants are seen amounting to P55.38 billion, of which mineral revenues will account for 34.4 percent, customs and exercise 29.5 percent while non-mineral income tax will contribute 17.5 percent.
Binedell is of the view that enforcement of tax collection such as transfer pricing, anti-avoidance, withholding taxes and information sharing are some of the ways that could be used to maintain tax collection.
He said the government has finally implemented tax scrap off for some commodities such as bread, rice and other farming implements even though he said the change was effected several months after the initial announcement.
When presenting about the impact of the minister’ speech on the business and investment climate, BOCCIM president Lekwalo Mosienyane said though the speech was inspiring to some degree, it has its shortcomings.
Mosienyane said though Matambo touched on some developments to be undertaken, he did not mention anything concerning major projects such as the Trans Kalahari Highway and Mmamabula coal project including their timelines.
Matambo had on Monday said a total of P12.93 billion was proposed for the development budget with the Ministry of Minerals, Energy and Water Resources getting P3.32 billion which is 25.7 percent of the development budget.
According to Matambo, this is to allow the government to address the water and power challenges facing the country by putting in place appropriate infrastructure. Among the projects that Matambo talked about under the ministry is the North South Carrier II as well as connecting Kanye and Molepolole to the North South Carrier.
It is for this reason that Mosienyane said the minister should have touched on the aforementioned projects which have serious implications on the local business climate.
The BOCCIM president also felt that Matambo did not comment about specific deliverables by the parastatals and did not mention about fiscal reforms.
Chief Economist with FNB South Africa, Sizwe Nxedlana said the fact that the surplus budget is contained in the local demands is somehow an inspiration on its own. In his speech, Matambo had disclosed a P1.2 billion surplus budget which he said would mainly be due to the anticipated 10 percent increase in mineral revenues.