‘Tax relief will only come in October’

Minister of finance and public enterprises Iipumbu Shiimi says the tax breaks he tabled in parliament during the national budget announcement may only reflect on employees’ payslips in October.

Shiimi said this during a Cabinet briefing on Monday.

He said the proposed law still has to go through the process of approval and gazzetting before it comes into effect.

“We are hoping that by October this whole process would be finalised, and you can get your tax refunds and also get some tax relief,” Shiimi said.

The tax relief will see that Namibians who are paid N$100 000 and less per year would not be liable to be taxed, as the tax threshold was moved from N$50 000 to N$100 000.

This is effective from 1 March.

Shiimi said that the ministry’s current structure needs to be reviewed as it is no longer fit for purpose.

The ministry was established a long time ago, and therefore the current structure that exists, which has not been reviewed for some time, is not fit for purpose,” he said.

One of the changes the ministry is working on is in the government’s procurement of goods and services, and how it manages the sovereign wealth fund for future generations.

Shiimi said the existing procurement law, implemented five years ago, is receiving updates through a new act.

He said one of the challenges identified with the law was the need for better governance within the procurement board.

“One of the challenges was the people who were managing procurement. We realised that even though we had the procurement board, its governance was not well structured,” Shiimi said.

He said the ministry is looking at creating a more favourable environment for small and medium enterprises (SMEs).

“If there is a competition between an SME and big business, preference must be given to the SME – even though the SME maybe more expensive,” Shiimi said.

He said that the revisions would also prioritise bids from local producers and women-owned businesses, even if their bids are slightly higher.

Additionally, Shiimi said the sovereign wealth fund, launched in 2022, currently stands at N$400 million, which is designed to benefit future generations.

“The current policy framework says you can only withdraw income, and that is what you can use for this current generation,” he said.

Shiimi said the ministry is actively seeking input from various stakeholders on the draft law governing the fund.

“We have consulted key stakeholders, and in the next few weeks we will submit our law to the Cabinet, and then it will follow the due processes,” he said.