Saara to go easy on taxpayers

FINANCE Minister Saara Kuugongelwa-Amadhila yesterday promised that she won’t raise taxes to compensate for the expected billion-dollar drop in income from the Southern African Customs Union (Sacu) this year.

‘You don’t want to kill the goose that lays the golden egg,’ the Minister, currently also the Chairperson of the Sacu Council of Ministers, said at a press conference in Windhoek.Finance Permanent Secretary Calle Schlettwein recently said that Namibia is likely to lose about N$1,3 billion from its share of the customs union revenue pool as the global recession bites into regional trade.In total, about N$9 billion less is expected to flow into the Sacu pool than last year, he said at the time.These figures might even be higher, Kuugongelwa-Amadhila warned yesterday.Sacu Executive Secretary Tswelopele Moremi earlier this year announced that the customs union was in the red – the first time in its 99-year history that it has recorded a deficit.Kuugongelwa-Amad-hila planned for N$8,6 billion from Sacu revenue in her 2009-2010 budget – about 40 per cent of Government’s total income of N$21,8 billion for this financial year. The Sacu windfall will now shrink to approximately N$7,3 billion, which means it can only fill 34 per cent of the State coffers.The Minister’s reluctance to hike taxes contradicts an earlier statement by her Deputy, Tjekero Tweya, who in June told the National Assembly that Government was looking at new taxes as one of the ways to deal with the shrinking Sacu income. Tweya told Parliament that their options included ‘broadening the domestic revenue base through strengthening tax collection and exploring new sources of taxes’.Kuugongelwa-Amadhila yesterday said it would be ‘difficult’ to increase taxes, as Government had just implemented income-tax breaks, and that Namibians needed the social relief ‘badly’.Schlettwein said Namibia was ‘pretty much covered’ for this year, as it could fall back on reserve income from Sacu that had not yet been paid out.Sacu revenue is paid to each country in four annual instalments, one in each quarter of the financial year in question, based on each country’s share in intra-Sacu imports. Since current intra-Sacu import data is not available at the time of transfer, the transfers are made based on projections. The Namibian Economic Policy Research Unit (Nepru) recently said Namibia, Botswana, Swaziland and Lesotho were still owed millions in excess collections from 2006 and 2007.’We can finance the current deficit from the fat of yesteryear,’ Schlettwein said yesterday.However, it is the next financial year that is filled with uncertainty.Kuugongelwa-Amad-hila said it was important that Sacu realised that it was the ‘master of its own destiny’.The Sacu governments needed to decide how they were going to finance the pool deficit. They could either put cash into the pool now or opt for lower incomes in future, she said.jo-mare@namibian.com.na