INCOME TAX ORDER AMENDMENT, 2023

The Eswatini Revenue Service (ERS) officially launched the Income Tax order Amendment 2023. These amendments are set to come into effect on 1^st July 2024 and they come at such a time where the recommendations of the business community have been taken into consideration and the legislators of the country saw it fit to somewhat ease their pains as they run businesses.

One of the changes noted is that the company income tax rate has been reduced from 27.5% to 25% for all companies that have an annual turnover of E500,000.00 and above. To then cater for businesses with a turnover that is less than E500,000.00, the Amendment then introduces the Presumptive tax regime which states that any business that has a turnover of less than E500,000.00 but more than E50,000.00 will be charged a rate of 1.75%. A business with a turnover of less than E50,000.00 will be charged a rate of 0%. The presumptive tax was introduced for tax payers who are willing to comply and pay tax but could not afford it before. It is important to note the presumptive tax excludes professionals such as accountants, lawyers, architects etc.

When a business goes through a loss, they can carry losses forward for a period of only 5 consecutive years with the exception of Timber and Orchard Plantations. After 5 years of loss, those losses will then be disregarded on year 6, but if at year 6 the business makes a profit then they will be taxed as necessary. If a timber plantation is operating at a loss, they can carry that loss until the timber is at a stage where it is mature. If an orchard plantation is operating at a loss, they can carry that loss until the orchard becomes productive.

Other changes that were highlighted include payments pending objections and/or appeals (also described as pay now and argue later to avoid penalty payments). Objections will be dealt with by the Commissioner General and the process is unlikely to go beyond 45 days. Independent insurance brokers will now be deemed as employees for tax purposes (PAYE). All insurance companies with independent brokers will be expected to hold PAYE when making their payments.

ANNUAL TAX INDABA 2024!!!

Explore the latest trends, regulations, and strategies to optimize your tax planning. Register now and secure your spot.

Key topics:

* Economic Growth and Taxation – Ministry of Finance

* Recent Trends in Tax Administration and Compliance – ERS

* Optimising the Dispute Resolution Mechanisms – RATE

Please click on the link below to register.

https://forms.gle/SQq49YyU4JCLr7858

OFFICIAL BAN OF PLASTIC CARRIERS

The Minister of Tourism and Environmental Affairs has announced that the Ministry is banning all plastic carrier bags through Legal Notice No. 155 of May 2021, this will be effective from the 1^st December 2024. All retailers, supermarkets, manufacturers and vendors will be prohibited from selling or providing for free single-use plastic shopping bags to customers. This mainly addresses carrier bags made from plastic materials such as polyethylene and polypropylene. BE is encouraging members particularly those in the manufacturing and retail sectors to stay ahead of the curve by beginning to think about how they will make the transition from plastic in light of the recently announced ban on plastics. As a secretariat, however, we feel the announcement by the minister is not entirely inconsistent with our position on climate change mitigation and environmental degradation. However, we are not oblivious to the adverse financial ramifications this may entail especially on companies involved in the manufacturing and production of plastic products. In this regard therefore, BE is encouraging members to approach the secretariat for advice in need.