Namibia’s 2014 Budget provides for a 20% increase in tax revenues. The Government recognizes that, while the domestic revenue stream will contribute significantly to expected revenue, a significant risk to Namibia’s fiscal outlook derives from uncertainty regarding future revenues, due to on-going reforms, to the Southern African Customs Union (SACU), comprising Botswana, Lesotho, Namibia, South Africa, and Swaziland. Its share of SACU revenue for 2014/15 is estimated at almost 35 percent of the Government’s total revenue.
There is a planned reduction in the non-mining corporate tax rate from 33 percent to 32 percent, but the tax rates are unchanged at 37.5 percent and 55 percent for non-diamond mining companies and diamond miners respectively. The 2014/15 Budget announcements include the introduction of export taxes to promote domestic value-addition in the primary commodity and natural resources sectors, and the introduction of the first phase of environmental taxes encompassing the carbon dioxide emission tax on motor vehicles, incandescent light bulbs and motor vehicle tires, in an effort to broaden Namibia’s tax base.
Excise duty rates will be reviewed in line with the provisions of the SACU Agreement and the introduction of a capital gains tax will be investigated. A new presumptive tax regime for small businesses is being studied.
A semi-autonomous Revenue Agency is to be created and this reform will be phased in over the next 36 months.
