Safari Court Stronger Together Namibia Budget Review … · Bill Civil Service Wage Bill ......

Stronger TogetherNamibia Budget Review 2017/2018

www.pwc.com.na

Safari Court Hotel & Conference Centre

March 2017

PwC

Budget Review 2017/2018

Key Focus Areas

Numbers in the Budget

Tax Comparisons

Tax Reforms

01 02 03 04

8 March 2017Namibia Budget Review 2017/2018

2

PwC

Key Focus Areas

Namibia Budget Review 2017/2018

3

8 March 2017

PwC

Key Focus Areas


4

8 March 2017

Inclusive Growth & Economic Diversification

Poverty Eradication

Harambee Prosperity Plan

Improved Public Service Delivery

“Maintaining Pro-growth Fiscal Consolidation: Making Impact where it Matters”

Macroeconmic Fundamentals & Fiscal Buffers1 2 3 4 5

1 2 3 4 5

1 2 3 4 5

1 2 3 4 5

1 2 3 4 5

PwC

Public Finance Reforms


5

8 March 2017

1 2 3 4 5 6

Mid-Year

Budget Review

Public Procurement

Act

PPP Legislation

Public Finance

Management Bill

Civil Service Wage Bill

Public Expenditure

Reviews

Macro-Economic Modelling

7

PwC

Namibian Economic Statistics


6

8 March 2017

ANGOLAZAMBIA

ZIMBABWE

BOTSWANA

SOUTH AFRICA

Tombua Cahama

Caiundo

Mavinga

Luiana

Kataba

SeshekeLivingstone

Tsau

OrapaGhanzi

Kang

Mamuno

TshabongMafikeng

Kuruman

Springbok

Bitterfontein

Victoria West

De Aar

KimberleyUpington

Gaborone

NAMIBIA

KongolaRundu

Opuwo

Tsumeb

OkakararaKhorixas

EpataOmaruru

Gobabis

Aranos

Maltahöhe

Lüderitz Aroab

Karasburg

Walvis Bay

Windhoek

South Atlantic Ocean

0 50

50

100

100

150 Kilometers

0 150 Miles

NAMIBIA

28.1%

Unemployment at March 2017

1.3%

GDP Growth

Inflation at January 2017

8.3%

N$12.96

USD: NADExchange Rate

PwC

The Numbers


7

8 March 2017

PwC

Revenue vs. Expenditure


8

8 March 2017

-20

-10

0

10

20

30

40

50

60

70

2016/17 2017/18 2018/19

Revenue Expenses Deficit

N$

in

Bil

lio

ns

N$

51.5

bn

N$

56

.4b

n

-N$

9b

n

N$

57

bn

N$

61b

n

N$

62

bn

N$

61b

n

-N$

6b

n

-N$

4b

n

PwC

Debt Stock as % of GDP


9

8 March 2017

N$71.67bn N$75.22bn

2017/2018 2019/2020

42%

PwC

Tax Revenue vs. Non-Tax Revenue


10

8 March 2017

40

30

20

10

70

60

502016/7 N$51bn

2017/8

80

N$

bil

lio

ns

N$53.38bn

N$2.66bn

Tax Revenue

Non-Tax Revenue

N$56bn

2017/8 N$56bn

PwC

Total Tax Revenue (N$ 53.38 billion)


11

8 March 2017

Income taxes36%

VAT26%

Property Taxes

1%

Withholding Taxes

1%

Customs & Excise

37%

PwC

SACU Receipts


12

8 March 2017

0

5

10

15

20

25

2016/17 2017/18 2018/19 2019/20

N$

in

Bil

lio

ns N$14.071bn

N$19.597bn

N$17.978bnN$18.891bn

PwC

Spending Comparison


13

8 March 2017

40

30

20

10

70

60

50

2016/7 N$61.5bn

2017/8

80

N$

bil

lio

ns

2017/8 N$62.5bn

PwC

Expenditure Execution Rates


14

8 March 2017

97.50% 96.40% 94.60%

0%

20%

40%

60%

80%

100%

PwC

Top 10 Budget Allocations


15

8 March 2017

1.95

2.87

3.07

3.28

3.72

5.02

5.68

6.51

9.1

11.98

0 2 4 6 8 10 12 14

Urban & Rural Development

Agriculture, Water & Forestry

Higher Education, Training & Innovation

Poverty Eradication & Social Welfare

Transport

Ministry of Safety & Security

Defence

Health & Social Services

Finance

Education, Arts & Culture

N$ in Billions

PwC

Top 10 Budget Cuts


16

8 March 2017

0% 20% 40% 60% 80% 100%

International Relations & Cooperation

Environment & Toursim

National Planning Commission

Higher Education, Training & Innovation

Agriculture, Water & Forestry

Labour & Related

Works

Urban & Rural Development

National Assembly

Electoral Commission N$86m

N$68m

N$669m

N$151m

N$24m

N$338m

N$432m

N$22m

N$39m

N$65m

PwC

Spending Priorities


17

8 March 2017

1 3

Education Basic & Higher

42

Public Safety & Order

Economic & Infrastructure Development

Improved Public Administration

PwC

Infrastructure Development


18

8 March 2017

Water & Storage Infrastructure

Road Projects

Railway Projects

Mass Land Serving

Port Development

N$9bn

SME Development

16%

PwC

Social Sector Investment


19

8 March 2017

N$27bn

48%

Ministry of Basic Education & Culture

N$12bn

Ministry of Health & Social Services

N$6.5bn

Ministry of Poverty Eradication

N$3bn

PwC

Tax Comparisons


20

8 March 2017

PwC

Comparisons: Corporate Tax Rates


21

8 March 2017

28%22%

32% 35%25%

30%

0%

20%

40%

60%

80%

100%

South Africa Botswana Namibia Zambia Zimbabwe Angola

PwC

Comparisons: VAT Rates


22

8 March 2017

14%12%

15% 16% 15%

10%

0%

10%

20%

South Africa Botswana Namibia Zambia Zimbabwe Angola

PwC

World Bank Report 2017Ease of paying taxes


23

8 March 2017

Botswana

Zambia

Namibia

Angola

Zimbabwe

51st

55th

58th

74th

157th

164th

3rd

4th

5th

9th

29th

31st

5

5 19

RSA

PwC

World Bank Report 2017


24

8 March 2017

Number of Tax Payments required to be compliant

27Zimbabwe

Botswana 34

Angola

South Africa

Zambia

South Africa

Namibia

51

31

27

26

7

PwC

World Bank Report 2017


25

8 March 2017

Amount of hours required to be compliant

302Zimbabwe 242South Africa 203Zambia 186Namibia 302Botswana 152

PwC

Tax Reforms


26

8 March 2017

PwC

Tax Amendments


27

8 March 2017

02

04

2015

Corporate Tax Rate

33% to 32%

03

01

VAT Threshold

N$500,000

WTS Rate

25% to 10%

Voluntary VAT Threshold –N$200k

PwC

Tax Amendments


28

8 March 2017

06

08

2015

Restraint of Trade payment taxation

07

05

PAYE on directors fees

Recovery of tax debts (provisions)

Lifting of corporate veil

PwC

Tax Amendments


29

8 March 2017

02

2016

Environmental Duties:

• Light bulbs

• Tyres

• CO2 emissions

01WTS: 10% to 25%

• Directors fees

• Foreign entertainers

PwC

Tax Proposals – 2017/2018


30

8 March 2017

xxx

Presumptive Tax

Solidarity/Wealth Tax

BEPS and 0% VATTax on Capital gains

PwC

Promulgated but not yet effective


31

8 March 2017

Team nameTeam name2

1 2

Export Levy Act

Customs & Excise Amendment Act 2016

PwC

SACU Excise Duty IncreasesSin Taxes effective 22 February 2017


32

8 March 2017

Rise in tobacco and alcohol excise duties: Increase New Duty

340 ml malt beer N$0.12 N$1.36

750 ml bottle of unfortified wine N$0.23 N$2.71

750 ml bottle of sparkling wine N$0.70 N$8.60

750 ml bottle of spirits (whiskey, brandy, vodka etc.) N$4.43 N$52.56

Pack of 20 cigarettes N$1.06 N$14.30

340 ml bottle ciders & alcoholic fruit beverages N$0.12 N$2.22

PwC

Other Reforms


33

8 March 2017

Tax Amnesty

DTA Framework Revision

Tax Incentives

Review

ITAS System

Transfer Pricing

Revenue Agency

Inland Revenue Reforms

PwC

Stronger Together

“True equality means holding everyone accountable in the same way, regardless of race, gender, faith, ethnicity – or political ideology”

Hon. Minister of Finance,Mr. Calle Schlettwein quoting Monica Crowley

8 March 2017Namibia Budget Review 2017/2018

34

Thank you

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The Budget Speech and presentations are available on:

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