WINDHOEK, Sept. 14 – Namibia Chamber of Commerce and Industry (NCCI) is requesting government to widen the tax base to incorporate those businesses that are evading paying tax by hiding their exact income.
NCCI boss Tarah Shaanika said his organisation has observed that a number of businesses, most of them foreign owned, do not provide tax receipts, while some even refuse electronic bank transfers.
This creates suspicions that such businesses may be trying to avoid declaring their true income in order to avoid paying taxes to the Namibian government.
“We have also noted that there are a number of foreign owned businesses, which still do not bank their income in local banks and appear to prefer keeping cash. We suspect that such businesses behave in that manner because they have something to hide to the Namibian government,” Shaanika said.
Shaanika stressed that these suspicions have been reported to the government on numerous occasions, but it appears that not much is being done to investigate such businesses in order to confirm or disprove the suspicions.
“We are concerned that the government is struggling to increase tax revenue because the tax base is not wide enough. The government appears to be quick to punish tax payers who fail to pay on time while turning a blind eye to foreign businesses which we believe do not pay taxes at all,” he said.
Moreover, many businesses face bankruptcy due to prolonged delay in payment for services delivered to the government as well as tax arrears, which if demanded to be paid in full, will threaten their continued existence, he added.
“Yet, we have foreign businesses getting away with non-compliance to tax. We have serious doubts about the effectiveness of the tax amnesty announced by the Ministry of Finance as an appropriate tool to increase tax collections. This amnesty was introduced at a wrong time, when most businesses are struggling and their capacity to pay tax arrears has weakened significantly,” Shaanika said.
Shaanika added that they doubt that the second amnesty will do the trick in collecting more revenue, considering the economic hardships, which define the business environment in Namibia at the moment.
He suggested that government consider widening the tax base,in order to hunt down businesses which hide income to avoid tax, and give adequate support to local businesses to grow. – Sharma Mundingi