BAN Calls for Action as Tax Exemptions Exceed NLe 3.5 Billion
The Budget Advocacy Network (BAN) is calling on the government to strengthen oversight of tax exemptions amid concerns over rising revenue losses and low compliance among some beneficiaries.
According to a BAN study, tax exemptions granted to industry-sector beneficiaries increased significantly from NLe 177 million in 2018 to more than NLe 3.5 billion in 2023.
The report states that industry-sector exemptions accounted for more than 60 percent of the total recorded revenue losses during the period, raising concerns about their impact on government revenue mobilisation.
The study also highlights compliance challenges among entities benefiting from tax exemptions. In 2024, exempt entities were expected to pay NLe 554 million but reportedly paid only NLe 306 million, leaving NLe 248 million outstanding in arrears.
Electricity and water companies recorded the lowest level of compliance, paying only about six percent of their assessed liabilities, according to the report.
BAN is urging the government to strengthen the management of tax exemptions, improve monitoring of beneficiaries and ensure that entities receiving tax relief meet their financial obligations.
The advocacy group said stronger oversight of tax exemptions could help reduce revenue losses and support the government’s efforts to mobilise domestic resources
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