Africa-Press – Eswatini. The Eswatini Revenue Service (ERS) has shed light on the extent of value Added Tax (VAT) evasion in the kingdom, announcing a staggering E554 million lost in 2023.
This was revealed came during the launch of the ‘Sondzela Sikhulume’ campaign aimed at fostering proactive tax compliance among individuals and businesses.
ers Commissioner General, Brightwell Nkambule, emphasised the severity of the issue, highlighting the impact on government revenue and fair competition.
“E554 million is a significant amount that could have funded crucial public services and initiatives,” he stated. He highlighted that VAT evasion not only harmed the government but also created an uneven playing field for businesses that comply with tax regulations.
The campaign, launched at ERS headquarters in Ezulwini, aims to bridge the gap between the tax authority and taxpayers, encouraging both individuals and businesses to proactively engage with ERS.
Nkambule emphasised the importance of open communication and collaboration as well as offering tailored solutions to help taxpayers meet their obligations.
While enforcement remains an option, Nkambule stressed the agency’s preference for voluntary compliance.
“We encourage taxpayers to come forward before we come to them or are flagged by other institutions,” said Nkambule, further revealing that the enforcement was not off the table.
Nkambule added that this allowed ERS and the client to work together to find solutions and avoid the penalties and legal ramifications associated with non-compliance.
Nkambule stressed the importance of voluntary compliance, urging individuals and businesses to come forward before facing enforcement action.
“We understand, and our doors will always be open” he said, adding that by working together, better solutions could be found and penalties associated with non-compliance could be avoided.
He said open communication and collaboration between taxpayers and the ERS led to a more efficient and effective tax system.
Nkambule stated that there were 5 510 VAT registered clients who were expected to collect VAT, further indicating that ERS observed that some VAT registered clients were collecting VAT but were under declaring. Hefurther highlighted that there were VAT registered clients who were collecting VAT and not declaring or remitting payment, while other VAT registered clients were declaring VAT but failed to remit payment.
Other observed behaviours, according to Nkambule were VAT un-registered clients collecting VAT, un-declared import VAT at border posts, as well as under declared import VAT.
Outlining legislation amendments of penalty provisions as passed in 2022, Nkambule said the introduction of special assessments in section 33bis now included a penalty for tax charged erroneously to be remitted to ERS as well as the offence created for unregistered taxpayers who charge tax.
He stated that section 47 amendment on refunds now recommended that a VAT certificate be placed at a prominent place in the place of business, adding that ERS would never pay input tax to taxpayers, who had been fraudulently charged VAT.
Furthermore, section 64 amendments on false statements indicates that there would be heavy penalty for persons making false statements when claiming input tax.
For More News And Analysis About Eswatini Follow Africa-Press
