Homeowners tax exemption still to be implemented

Job seekers outside labour offices
Job seekers outside labour offices

The implementation of a proposed tax exemption on first time homeowners, which was announced by the Minister of Finance, and Development Planning Kenneth Matambo in the 2014 budget is still to be implemented.

The status quo is a source of frustration for the parliamentary Committee on Statutory Bodies and State Enterprises. The committee chairperson, Samson Moyo Guma expressed his unhappiness when they were examining the books of the Botswana Unified Revenue Services yesterday. Guma expressed concern at the delayed implementation of the policy.

“This was mentioned to Parliament in the budget speech. We passed the budget with the understanding that the implementation should not be a problem,” said Guma.

Guma said when Matambo was presenting the policy, there was nowhere he mentioned house building, but spoke about first time homebuyers. He said that the implementation is taking long to the annoyance of its intended beneficiaries. He noted that when the minister made the pronouncement, it generated excitement among young people who had seen this as a good move, but if it delays, many will lose confidence.

The proposal was to provide a tax exemption to citizens, especially the youth when they purchase their homes for the first time. It came about in the amendment of the VAT Act as part of government’s efforts to simplify the tax regime to encourage citizens to own homes.

When responding to Guma’s concerns, BURS commissioner Keneilwe Morris said that although the matter was discussed and agreed on with the ministry of finance, issues of implementation have now emanated.

Morris said that they are undertaking processes of what modalities to use as it will not be easy to administer it nationally. He said that with most first time homeowners preferring to build rather than buying, this will create an administration problem as people buy building materials from different shops. He said that this prompts issues of equity more than anything. Morris however noted that it would be easy for BURS to implement it if people bought houses from Botswana Housing Corporation.

He acknowledged the discomfort that the delay could have brought to the public. He said they would engage other stakeholders at the Ministries of Lands and Housing and Finance and Development Planning to iron out the holding factors quickly and begin implementation.

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