Ministry rules out VAT increases

The Ministry of Finance & Public Enterprises has ruled out any increases in value-added tax (VAT) in Namibia, irrespective of potential changes in neighbouring South Africa's tax policies. According to The Namibian, deputy executive director of economic policy Oscar Capelao confirmed that Namibia maintains an independent tax policy within the Southern African Customs Union (Sacu). ‘Importing countries apply respective VAT rates at the point of import. Our imports from SA will continue to be subject to our 15% rate,’ he said. He further noted that businesses claim input VAT on their tax returns, mitigating any immediate cost implications for businesses operating in Namibia. Addressing concerns over potential price hikes, Capelao emphasised that a VAT increase in SA would not automatically lead to higher prices in Namibia. He added that when SA increased its VAT rates previously, there had been a similar muted impact on Namibia. However, he acknowledged that market dynamics could have a long-term influence on pricing and trade patterns.

Full report in The Namibian