The Namibia Chamber of Commerce and Industry (NCCI) says utilisation of local capacity in development projects would significantly boost economic activity by stimulating money circulation within the country.
The Chamber advised businesses to be mindful and avoid price inflation.
“We urge businesses given the opportunity to be involved in such projects to be fair and reasonable in their pricing practices as a strategy to be competitive. Additionally, to adhere rigidly to ethical practices and professionalism when it comes to executing public sector tenders,” said NCCI President Bisey /Uirab.
/Uirab made these remarks at the Namibia Annual Budget Dialogue event on Wednesday where he applauded the Minister of Finance and Public Enterprises, Iipumbu Shiimi, for the consultative approach taken in the budget planning process.
“It is encouraging that the views and concerns raised, and the recommendations made by NCCI in consultative sessions are and have been accommodated. It is also worthy of singling out NCCI’s advocacy efforts that have resulted in the tax relief programme for individual, business and corporate tax. The Chamber started negotiating this in 2019, long before the onset of the Covid-19 pandemic,” said /Uirab.
This comes after Shiimi, last month, tabled a N$100.1-billion national budget, and announced tax reforms that will see corporate taxes easing from 32% to 30% and further reducing to 28%.
In addition to these reforms, Shiimi said the tax-free bracket has been adjusted from N$50,000 to N$100,000, while also adjusting the tax for individuals including for SMEs whose turnover is below N$10 million per annum.
“These tax relief for both individuals and corporates, are indeed a step in the right direction. By increasing the tax exemption threshold for individuals, we alleviate the burden on lower-income households amidst the challenges posed by escalating inflation. The reduction of corporate tax is a significant move towards making Namibia a more attractive investment destination, fostering competitiveness and growth in our economy,” he said.
He said NCCI now waits in anticipation for the enactment of the Special Economic Zones (SEZ) Bill in the National Assembly this financial year.
Participants in the SEZ will be subject to a corporate income tax rate of 20%. The normal deductions in terms of capital allowances will apply in the SEZ regime while VAT will be zero rated.
“The potential of SEZs in driving economic growth is a no-brainer.”
Furthermore, /Uirab said NamRA’s robust revenue collection, which it collects N$52 billion out of the over N$70 billion debt, is to be reckoned with as it will allow the government to address developmental and social needs. However, the total capital of tax arrears stood at N$17.3 billion at the end of January 2024.
“Thus, the NCCI is appreciative of NamRA’s ongoing partnership with the Chamber in ensuring tax compliance by businesses, big and small. With NamRA we have made strides in sensitising businesses on tax compliance and the importance of meeting obligations through initiatives like the ITAS training programme. I am pleased to announce that in 2023 alone, we successfully trained 108 SMEs, and now we look forward to further collaboration this year,” he stated.
The NCCI President also commended the NamRA’s Tax Amnesty Programme, which will run until 30 October this year, saying it provided much-needed relief to businesses by waiving interest and penalties.
“Therefore, NCCI reiterates its call on the business community to take note that while we reach out to the Government to be accommodative and support the revival and growth of business. We, too, must also play our part in ensuring compliance with laws, rules and regulations,” /Uirab said.
“We must be ever mindful of our responsibility as businesses, to meet our tax obligations, and thereby contribute to the development and sustainability of our nation. So please, let us give to Caesar what belongs to Caesar.”
/Uirab said the Chamber is encouraged by the government’s efforts to source funding domestically, mitigating currency fluctuation risks and as a strategy to ensure fiscal stability.
