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MPs suspend Vat rules

03/04/2012 00:00:00 webmaster

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LOBAMBA—Members of Parliament (MPs) have passed a motion calling on the suspension of regulations governing Value Added Tax (VAT).

This puts the fate of the VAT Act in the balance as the regulations go together with it. By last night it could not immediately be ascertained what government’s next move now would be following this resolution.

Just into two days after VAT had been effected from April 1; the MPs unanimously voted that the tax should cease operating pending consultation with various stakeholders. This transpired during a motion moved to discuss regulations governing VAT.

MPs called on the Minister of Finance Majozi Sithole to suspend VAT for three months pending extensive teaching of the people out there.

Timphisini MP Jennifer Du Pont suggested that the Minister of Finance dispatch people across the 55 constituencies to teach people about VAT.

Du Pont said the fiscal crisis and the introduction of VAT was making the people aggrieved. She further said MPs were not consulted sufficiently on the introduction of VAT.

The motion was moved by Kwalu-seni MP Sibusiso Mabhanisi Dlamini. "The people do not understand VAT. The ministry of Finance has not fully expounded on this form of tax," he said.

Dlamini said there was a lot that was lacking in the VAT regulations. He said there were businesspeople who buy their goods from outside the country. He said those goods are taxed through VAT, yet some of the commodities will be VAT free.

The legislator observed that in that case there was no provision on how the business person would be compensated.

Dlamini said the matter of VAT has been discussed at his constituency and the electorates voiced their grievances against VAT.

The MPs passed the motion and it was adopted. The Kwaluseni MP thanked the MPs for supporting his motion. Dlamini said it really showed that the MPs were representing the interests of the electorates.

Swaziland Revenue Authority’s PRO Vusi Dlamini was not immediately available for comment on the implications of the resolution last night.

...MPs fear Vat will bring unrest

MBABANE – Members of Parliament fear that allowing VAT to proceed could create unrest in the country.

MP Masende Zwane said VAT should be suspended and be discussed by the Finance Committee.

He was supported by Nhlambeni legislator Frans Dlamini who said the regulations should be stopped while VAT is being discussed.

Dlamini said there were a lot of disgruntled people due to the introduction of the tax.

Overthrown

He made an example of a certain king in the Bible who was finally overthrown for getting the wrong advice to double tax.

He said the country would be in commotion if the various groups could unite. "The matter should be discussed by the Finance Committee while it is suspended," he said.

Tax hurting SMEs - MP

LOBAMBA - Lobamba MP Majahodvwa Khumalo said Small Medium Enterprise (SMEs) were the most affected by the introduction of VAT.

He said it was imperative that people and businesspeople be roped in so that they fully understand the subject.

"People love Tinkhundla system of governance but they say VAT should be suspended for a while," he said.

The Member of Parliament (MP) said there was a need for a new exercise to teach people on VAT. "The timing for the introduction of VAT is wrong. The country has not yet recovered from the economic recession," he said.

He said what mattered was looking for ways in which the country’s economy could be resuscitated.

The MP said there were other areas which the VAT regulations do not accommodate. He said VAT does not cater for businesspeople who were already supplying government.

Khumalo said in such cases it was wise to take inflation into consideration, something he said was lacking in the current regulation.

"Many businesses have closed down because proprietors do not understand VAT. There is a great need for the ministry to teach the populace about VAT until they understand the concept. Otherwise, people are determined to pay tax," he said.

Nkhaba MP Enock Dlamini said people were aggrieved by the introduction of VAT.

He said people out there did not comprehend the concept. "If things were to go according to my wishes, VAT could have been suspended for six months. The three months is too little," he said.

Majozi, legislators in stand-off LOBAMBA—There was a stand-off between legislators and Minister of Finance Majozi Sithole over the debate of the Value Added Tax (VAT) regulations.

The Minister of Finance said the matter could not be debated according to section 253 of the Constitution as the motion said.

Sithole said the matter was tabled before the House of Assembly on March 8 this year.

The minister said there was a regulation which was made by the legislators that a matter which has been tabled and not discussed within 14 days could not be debated according to Section 253 of the Constitution.

The Speaker of the House Prince Guduza asked Sithole that since the matter could not be discussed with that provision, which law were they supposed to follow then.

The Deputy Prime Minister, Themba Masuku, and the Attorney General tried to intervene.

But the legislators maintained that they would debate the issue.

The parliamentarians told Sithole that they were busy discussing the Finance budget hence the delay.

Sithole reminded the Members of Parliament that there was a regulation that VAT starts operating on April 1.

Lobamba Lomdzala MP Marwick Khumalo said the minister was supposed to consult with the office of the Speaker to find out if there would be certain problems when the matter is debated later on.

Finally, the debate went ahead. The legislators passed a resolution that the regulations of VAT be suspended for three months pending consultation with various stakeholders.

Comments

The MPs must not expect us to treat them like Heroes now. If they really meant business they would never have allowed the VAT to come into existence without a through consultation with stakeholders. As it is now they are already too late because stores and service providers have already implemented the 14 percent. If this is a way of campaigning for re-election they are joking!
Apr 3, 2012, 7:26 AM, Mbutfo

When I first saw the article, I said Holy Moses! How can parliament throw the nation into such confusion. This is chaos! My basis for that was that regulations are debated by parliament before the legislation comes into effect, and I just wondered why now talk of suspending regulations when they passed them in the first place? Again, how does Sithole, never mind the Constitutional provision, explain the delay in submitting regulations as late as March 8th for a legislation that takes effect 1st April that affects the entire economy? When did he expect the stake holders to have studies and prepared for implementation in under a month? I mean this change from business requires change of operating systems and software enhancements. Someone out there is not planning their work properly, I mean last minute presentation of regulations and a parliament that waits until the thing is effected before crying wolf, wolf! Surely someone has to be proactive in these matters. Look at the confusion that will ensue, pitting the public against retailers and so on. And now, parliament is using a newly found tactic, that this will cause a revolution if not suspended, and I say to myself these people have very fertile imaginations. You know when people run out of ideas, they say unintended stuff. My take is that Sithole means well in implementing VAT, the only gripe I have with the man is his delay in submitting the regulations to parliament; and so is Parliament in suspending implementation, it's just that I don't like the timing of it. It would have been better for parliament to ask Sithole prior to 1st April to postpone implementation pending the debate; rather than ambush the man this way. Sithole ambushed parliament as well bringing this provisions, instead of forewarning parliament about his intended stance. Parliament does also have a tendency to sit on important pieces of legislation for longer than is necessary. Consider the Communications Commission bill and others that have been in parliament for over 2 years. I mean last year it took His Majesty to intervene to have legislation passed. This tendency frustrates the hell out the executive arm of government. These two arms of government are dysfunctional, I think it's time somebody stepped in to call these two to order.
Apr 3, 2012, 7:26 AM, Burns Dlamini Lobhoncela (Burnspolitics@gmail.com)

As much I'm not well vest with VAT and how it really works. It is clear when it comes to 2013, people should lobby for MPs with the basics of reasoning, no ex-convicts, and most of all someone who does research and must be willing to help people from the ground up. I said the other time, very same law of the VAT/TAX was made by them and when the same law is not in their favor they frown upon it. Really how do we run things in Swaziland and what would one expect from Johannes, Mabhanisi, Robert Magongo in parliament?And when you read through their reasons why the VAT should be suspended, does not add up. These MPs are in it for the stomach and personal agendas. Some of them are in businesses, they never saw TAX/VAT coming, they now want to reverse the same law that was deliberated in parliament by them, went through the processes and now they want to suspend VAT, next thing they will suspend TAX. This whole exercise of VAT was quite expensive and it will be more expensive to the tax payers, because running a campaign of this magnitude, the same money could've have fed and schooled a couple of OVCs and plus pool it into Swaziland's economy and or reserves. This is embarrassing to say the least. Dressler
Apr 3, 2012, 9:00 AM, Dressler (dressler@yahoo.co.uk)

Akunyuswe nalamaholo or kutoba ngumsindvo lentfo le
Apr 3, 2012, 10:34 AM, steve (stevetembe@yahoo.com)

Much as I'm happy with the MPs attempts but I'll say hardluck guys. 2013 sewusondzele (or should I say April 12?) You guys were elected in 2008 but senicala kubona nyalo kutsi kumele kusentjetwe? You were busy debating useless stuff like your salary cuts. Keep on campaigning though.
Apr 3, 2012, 11:36 AM, Lord Anthony (anthonym198@gmail.com)

Its been a while the VAT system was introduced for Sales Tax, bekusolo kuthulwe leni sive sacala kadzeni sikhala? Now the election time is approaching they are starting to be busy, asisibo bantfwana tsine! We will get benefits from MPs now, from soccer, roads, food hampers etc. Anyway make it happen although we know very well about your intentions but really i won't elect anyone, SENG'DZINIWE KUDLALA NGESIKHATSI SAMI.
Apr 3, 2012, 11:57 AM, cellular (smthizo@gmail.com)

VAT for what? What difference will it make having it introduced? Believe you me, VAT is designed by the government to accumulate more money for itself while the Swazis remain poorer day by day. How do you expect the elderly people living on grants to survive under this VAT? Is the welfare of the people considered here? How about the unemployed? VAT for what then? Why are we being made scapegoats because we did not play even a single role when the government drowned the country into this fiscal scenario. Its the government's mistake and we should not be dragged into this issue...AWAY WITH MAJOZI'S VAT AWAY!
Apr 3, 2012, 11:57 AM, Kalawa (mbhasobhid94@gmail.com)