• Market Watch

Lower corporate tax rates to bolster investments

• 4 Days Ago - 2024-10-14 00:00:00

Finance minister Ipumbu Shiimi says government’s decision to reduce corporate tax rates is aimed at encouraging businesses to invest in Namibia.
Shiimi made these comments during a briefing on the state of affairs of his ministry, noting that Namibia’s corporate tax rate of 32% is too high compared to its peers in the Southern African Development Community (SADC), which have lower corporate tax rates.
In comparison, Namibia’s corporate tax rate of 32% is significantly higher than that of its neighbours, with Angola at 25%, Botswana at 22%, South Africa at 27%, Zambia at 30% and Zimbabwe at 25%.
“We have realised that we need to reduce that [corporate tax rate]. First of all, when we compare within our region, we have realised that the income tax of companies in Namibia is relatively higher compared to our neighbours, so we have decided that we need to reduce ours to attract investment,” the finance minister said of Namibia’s decision to reduce the corporate tax rate to 31%.
Going forward, Namibia will gradually reduce its tax rates in an effort to bolster investment, Shiimi explained.
“That has now been reduced to 31%; next year we have made a decision that we will reduce it to 30% and the direction of travel is for us to reduce it further. What we want is to have a competitive tax rate that is going to help us attract investments,” he said.
A reduction in the corporate tax rate is viewed as a boon to encourage job creation, Shiimi noted.
“It is to incentivise companies and corporates to invest more, because we want to see more investments because investments mean more growth and more jobs,” Shiimi said.