SRA STRUGGLING TO LEVEL THE PLAYING FIELD

MBABANE – While government is hell-bent on taxing emaSwati to the marrow, the SRA is perceivably not doing enough in levelling the playing ground among qualified taxpayers as it is not aggressively bringing titimela owners, cattle farmers and witch doctors (tinyanga) among others.

Titimela is a popular name for the one-room rented flats. According to the Income Tax Order of 1975, everyone, either on individual capacity or business is supposed to pay tax to government through the Swaziland Revenue Authority (SRA). However, Vusi Dlamini – SRA Communications Director said SRA have registered titimela and cattle farmers taxpayers in their database but he was quick to state that:  “What you are referring to is informal business and generally it is difficult to follow-up informal businesses for tax purposes. Our compliance strategy is more risk based, and if we notice certain level of risk among a certain sector, we certainly devise strategies to deal with those sectors.”
Against this backdrop, Dlamini said he assumes there are cattle farmers and titimela owners registered with the SRA for tax purposes but could not give the numbers. Dlamini told the Times SUNDAY that according to the legislation,  any person deriving income in Eswatini is expected to declare that income and if it reaches the taxable level will be taxed accordingly.

In relation to whether titimela, tinyanga or cattle farmers religiously pay what is due to government, Dlamini said: “As long as a person makes that income in Eswatini, they have to declare that income. I cannot be specific whether we have anyone who is registered as inyanga in the taxpayer’s database. On titimela, we know that some people have registered with the SRA as they make ‘rental income’. We do have farmers for sure, but I cannot be specific in terms of livestock and vegetable farming e.t.c. But, yes any person who is in the business of selling cattle must register with the SRA and pay taxes accordingly if they qualify. Asked if the SRA is doing something to ensure that all eligible taxpayers comply, he said that depended on their compliance strategy at the time. This is happening against the backdrop that Eswatini’s ratio of total tax to Gross Domestic Product (GDP) was E16.4 billion -33 per cent.

This means the amount of tax paid by Swazis made up about a third of the total value of all the goods and services produced in the country that year. This is double the world average of 15 per cent. Arguably, this means when it comes to taxation of its citizens, Eswatini is among the unique case studies. It is a developing country but with one of the highest tax burdens in the world. Averagely, Eswatini’s tax burden, excluding Pay As You Earn (PAYE) stands at 27 per cent. It is above the average tax burden of South Africa (26 per cent), Senegal (24 per cent), Zambia (22.7 per cent), Kenya (20 per cent), Tanzania (23 per cent), Angola (14 per cent) and Botswana (14.7 per cent). Hard data from the World Bank shows that the ratio of tax paid compared with GDP has just been increasing over the past four decades and while the individual tax and company tax burdens are very high, the indirect consumption taxes, which hit the poor and the middle classes hardest, are also in the top third in the world.

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