Extensive changes were introduced to Botswana's taxation system in 1995/7 to enhance the incentives for domestic and foreign investment, improving competitiveness and increasing the disposable income of individual taxpayers. The top personal tax rate was brought into line with the corporate rate of 25%. In the budget of 2001 the rate for top marginal tax was increased to P100,000, with no tax to pay up to P25,000.
From 1999 a new non-negotiable mining tax formula was introduced in order to provide international investors with greater certainty. A variable rate income tax was introduced with parameters set at internationally competitive levels, between a minimum of 25% and a maximum of 55%.
Value Added Tax
Value Added Tax was introduced to replace sales tax from July 2002. It was set at a uniform rate of 10% applied to all goods and services. Its aim is to broaden the government's revenue base. Traders with an annual turnover exceeding P250,000 are required to register for VAT. VAT applies to almost all goods and services supplied. The list of exempt and zero rated supplies is very limited. All queries should go to:
Department of Customs and Excise
PB 0041, Gaborone
Tel: 322 855 or 364 2100
Toll free: 0800 600 702