Government to increase income tax threshold for individuals

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Minister of Finance, Iipumbu Shiimi on Tuesday announced that the ministry will assess the threshold for income tax for individuals who are paid less than N.dollars 100 000 per annum.

Shiimi said this while addressing Cabinet during his mid-year financial budget review for 2022/23.

The finance minister stated that the government would like to increase the current N.dollars 50 000 tax-free bracket for income tax on individuals to N.dollars 100 000 to provide relief to low-income earners.

“Effective revenue mobilisation is a key pillar of our envisaged medium-term fiscal framework. It is critical to ensure an optimal mix of responsive tax policy, tax administration reforms, as well as adequate tax compliance to enhance the contribution of revenue on smoothing the fiscal adjustment path,” he said.

Shiimi added that they are still of the view that it is not the right time to introduce any tax proposals that could stifle economic recovery.

“The economic landscape continues to be fragile and the emerging green shoots in the domestic economy are still susceptible to significant vulnerabilities in the global economy. Therefore, in the area of tax policy and tax administration reforms, we are focused on the implementation of measures that could potentially provide some relief to taxpayers in the near to medium term,” Shiimi said.

Apart from the individual income tax, Shiimi also announced a reduction in the non-mining company tax rate of two percentage points over the two outer years of the next Midterm Term Expenditure Framework (MTEF).

“New guidelines for the issuance of Good Standing Certificates have been developed by NamRA aligned with our continued efforts to improve tax compliance. The agency will announce the necessary implementation details and timelines thereof in due course,” he said, stating that NamRA has crafted a tax compliance and enforcement strategy which will be rolled out over the MTEF to combat tax evasion.

Source: The Namibian Press Agency