Rédaction Africa Links 24 with Selma Iyambo
Published on 2024-03-01 17:00:00
The Ministry of Finance and Public Enterprises has allocated N$1.4 billion in the operational budget for once-off tax debt relief for selected public enterprises. This initiative is aimed at addressing legacy debt that was accumulated before the establishment of the Namibia Revenue Agency (Namra). Finance Minister Iipumbu Shiimi made this announcement during the national budget tabling, which had the theme ‘Continuing the Legacy of Hage Geingob by Caring for the Namibian Child’.
Shiimi clarified that this one-off exercise is exceptional and is specifically intended to clear the legacy debt of public enterprises that were impacted by fiscal consolidation in previous years. The identified beneficiaries of this relief package include the University of Namibia, TransNamib, the Namibian Broadcasting Corporation, New Era Publication Corporation, the National Fishing Corporation of Namibia, and the Roads Contractor Company.
The finance minister emphasized that this action is necessary to enable Namra to enforce tax regulations uniformly across all taxpayers. He also stated that any future tax liabilities accrued by public enterprises will not be supported by the treasury. Economist Salomo Hei noted that all the selected enterprises share the same shareholder, and Shiimi’s budget presentation projected a significant increase in income and expenditure.
Hei stressed the importance of accountability and urged the entities to maintain regular monitoring of their tax compliance. He emphasized that compliance with tax obligations is crucial for overall corporate governance adherence. Lameck Odada, a business management expert, highlighted the lack of audited financial statements for public enterprises, which could lead to the accumulation of tax debts.
Odada called for strict policies to ensure adherence to guidelines and prevent unsustainable bailouts by the government. He suggested implementing performance contracts to strengthen governance structures within these entities. Without adequate governance measures, the recurring issues of financial mismanagement and tax debt could persist.
In conclusion, the government’s decision to provide once-off tax debt relief to selected public enterprises aims to alleviate the burden of legacy debt and enable a fresh start for better compliance with tax obligations and financial transparency. By holding these entities accountable and implementing stricter governance frameworks, the government can work towards sustainable financial management practices and reduce the need for future bailouts.
Read the original article on The Namibian
