The poor foot the COVID-19 bill as rich evade tax

Bottom tier: While others become millionaires, others scrape the bottom of the barrell PIC: MORERI SEJAKGOMO
Bottom tier: While others become millionaires, others scrape the bottom of the barrell PIC: MORERI SEJAKGOMO

The long established gap between the rich and poor in the country is worsening as recent tax and tariff increases push ordinary Batswana beyond their limits, while some of the wealthy continue to evade their share of the tax burden, thanks to a toothless Botswana Unified Revenue Service (BURS).

An authoritative report recently estimated that 200 more people had become US dollar millionaires in Botswana during 2020, a year in which ordinary citizens struggled against the COVID-19 pandemic and its effect on livelihoods. On the other end of the scale, meanwhile, Statistics Botswana, estimates that at least 67,000 people, most of them aged between 25 and 29 years old, lost their jobs or businesses due to COVID-19 last year. The taxes that were recently reviewed include Value Added Tax up to 14%, a new sugar levy, and raised fuel levy to P1, which in turn increased pump prices by P1. In addition, water and electricity tariffs have gone up, as have Botswana Housing Corporation rentals.

Most of the increases are under what government calls “domestic resource mobilisation,” which refers to squeezing higher revenues from local sources in order to fund the budget. The 2021/22 national budget is expected to suffer a P6 billion shortfall and government’s reserves are running threadbare due to COVID-19 expenditure last year. Highly placed sources at the BURS have said some of tax reviews would not have been necessary if tax evaders and avoiders in the economy were being properly pursued and brought to account. It is understood the BURS has just 20 investigators in its Investigation Compliance and Enforcement (ICE) Unit, a situation that is allowing wealthy tax evaders off the hook.

Editor's Comment
Let the law take its course

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