MBABANE – A wave of frustration is sweeping through the business community, from small traders in Manzini’s markets to mid-sized companies in Mbabane’s industrial areas.
Businesspeople say the immediate implementation of the Tax Clearance Certificate (TCC) requirement by the Eswatini Revenue Services (ERS) has the potential to kill local businesses.
Speaking to the Times SUNDAY, they criticised the Eswatini ERS’s requirement of the TCC for tenders and services valued above E20 000, saying it is depriving emaSwati of the opportunity to run businesses effectively.
The frustration, they say, stems from the requirement that almost every commercial transaction must now be accompanied by a tax clearance certificate.
Many emaSwati say it is crippling local enterprise. The complaints are especially loud around specific types of transactions, which have become major stumbling blocks for ordinary businesspeople.
The businesspeople said the tendering for the provision of goods or services to a parastatal body, company or ‘any other entity’ has become one of the most controversial. It means that anyone tendering to supply goods or services of E20 000 and above not only to government or parastatals, but also to private companies or other organisations, must first produce a tax clearance certificate.
Businesspeople argue that this requirement is too broad and restrictive. It effectively forces every entrepreneur, even those doing private business, to prove tax compliance before being considered for any contract.
For example, one entrepreneur said a local plumber bidding for a small job at a private firm or a catering company offering services to a church or NGO, is now expected to present a tax clearance certificate if that job is at E20 000 plus. The entrepreneurs described this as unrealistic and anti-business, especially for micro and small enterprises that operate informally.
It must be said that the phrase ‘any other entity’ has created confusion and fear. They said it suggests that no business transaction is exempt, no matter how small. Many informal traders who previously survived through private contracts are now being excluded because they lack the required paperwork.
Another businesswoman , all of them speaking on condition of anonymity, said the policy has chilling effect on entrepreneurship because it discourages emaSwati from tendering or expanding their businesses.
The entertainment and events industry have not been spared. Under the law, any local agent, promoter or non-resident entertainer or sportsperson seeking to perform or host an event in Eswatini must first obtain a tax clearance certificate.
Analysts say the policy has ended up discouraging investment in the creative sector.
Local promoters complain that the process is cumbersome and slow. They must apply for a tax clearance before booking an artist, meaning they often miss out on international acts who operate on tight schedules. For non-resident entertainers, the requirement feels like red tape and bureaucracy, making Eswatini less attractive as a performance destination compared to neighbouring countries like South Africa or Mozambique.
The impact on local artists is equally severe according to local promoters. Many cannot secure gigs or sponsorships because promoters are reluctant to deal with the paperwork.
What’s the effect? The Times SUNDAY has been told that the ripple effect is fewer concerts, less tourism and declining income for musicians, event organisers and related businesses such as sound technicians, caterers and venue owners.
*Full article available on Pressreader*
Brightwell Nkambule, the Commissioner General, has revealed the rationale behind the TCC issue. (Pic: ERS)