The Minister of Finance and Public Enterprises, Ipumbu Shiimi, on Wednesday announced a final two-year extension of the tax amnesty programme, now set to conclude on 31 October 2026.
This comes as the Namibia Revenue Agency (NamRA) reported that the tax amnesty programme has generated N$4.3 billion in revenue since it was launched in April 2023.
The announcement follows numerous requests from various sectors for an extension before the original deadline of 31 October 2024.
“In line with our commitment to strike a balance between collecting revenue and boosting the investment climate, we hereby extend the tax amnesty programme by another two years until 31 October 2026. The extension has considered the two years of the COVID-19 pandemic which significantly reduced the income of many taxpayers,” Shiimi said.
The Minister explained that the extension aligns with the government’s broader strategy of tax policy and administration reforms, aimed at easing the tax burden and stimulating economic recovery.
Key measures include reducing the non-mining corporate tax rate from 34% to 31% effective from April 2024, with a further gradual decrease to 28% planned for the 2026/27 fiscal year.
Additionally, the income tax threshold for individuals has been raised to N$100,000, with plans to adjust all tax brackets for inflation in the next two years, costing approximately N$712.9 million annually.
“Again, we will make more substantive tax policy commitments in future budget statements once we have some additional certainty on the medium-term revenue outlook,” he said.
Shiimi also said growth in the Namibian economy is estimated to be 3.6% in 2024, with an improvement to 5.4% expected in 2025.
He noted that this represents a revision of the initial forecasts presented in the main budget, which were 4.0% for 2024 and 3.9% for 2025, respectively.
“The revision of the growth forecasts considered, among others, the significant weaknesses in the diamond sector as well as the gravity of the drought and its subsequent impact on agricultural activities,” he said.
He further explained that the total revenue collections for the fiscal year 2023/24 reached N$81.5 billion, surpassing revised estimates of N$81.1 billion. This positive outcome reflects over-collections in key areas, including individual income tax and withholding taxes.
While operational expenditure for the same fiscal year was recorded at N$67.9 billion, close to budget estimates, development expenditure was N$7.1 billion against a revised budget of N$8.4 billion.
This indicates challenges in executing development projects, which the National Planning Commission is addressing by identifying bottlenecks.
“We have noted concerning capacity, institutional and other operational constraints that impede timely execution of development projects. In this regard, the National Planning Commission is spearheading a process to identify the specific bottlenecks and make the necessary recommendations to improve the pace of project implementation, going forward,” Shiimi said.
Furthermore, the budget deficit for the 2023/24 financial year stood at N$5.6 billion, equivalent to 2.4% of GDP, a marked improvement from the previous year’s 5.2%.
The total debt stock at the end of March 2024 was N$153.7 billion, or 65.1% of GDP, down from 67.6% in the previous financial year.
Looking ahead, preliminary revenue for the current financial year has reached N$45.7 billion by the halfway mark.
However, the execution rates for operational and development expenditures highlight areas that require attention to ensure fiscal sustainability, Shiimi said.
