BURS Clamps Down on Tax Fraudsters

* Tracking system to save economy billions * Economy estimated to lose P3bn in contraband * BURS to use E-Billing for VAT as its collection lowers Principals at Botswana Unified Revenue Service (BURS) are confident that the new digital track and trace system and electronic billing for VAT will save the economy billions of pula that are being lost through smuggling of illegal goods across Botswana's borders. [ihc-hide-content ihc_mb_type="show" ihc_mb_who="1,2,3,4" ihc_mb_template="3" ] The move to adopt both E-billing for VAT collection and the digital track and trace systems is coming at a low point in collections in some areas. According to Commissioner of Operations at BURS, Tutu Bakwena, BURS collected VAT amounting to P4.8 billion between April and September 2022, falling short of the target P5.9 billion. Speaking at a press conference in Gaborone this week, Bakwena said the E-Billing system should enhance collection of VAT, given the plenitude of eligible businesses to collect from. "We cannot say for now how much we expect to collect through the e-billing system, but we believe that we will be able to collect more than the 30 percent and 50 percent revenue that we are currently collecting,” he said. “The system will enable us to detect fraudsters." Also addressing the press conference, BURS Commissioner Customs, Segolo Lekau, said the track and trace system is aimed at tackling smuggled goods into the country, particularly alcohol and tobacco. He added that smuggling affects profit margins of ligitimate businesses that pay tax. But Botswana Alcohol Industry Association (BAIA) has not welcomed the track-and-trace system because it sees it as an additional burden for the reason that businesses will be expected to buy the stamps that go with it. BAIA has also argued that a plethora of taxes and levies on alcohol already exists. Further, the industry has noted that the biometric machines are costly and it is not clear who will bear the cost. The track-and-trace system involves placing a biometric imprint on all alcohol and the tobacco products as they are manufactured and imported into the country, allowing BURS to check that correct tax revenue is being paid and that products are genuine. BURS anticipates that the system will boost tax revenue collections from importers also by increasing industry compliance, reducing illicit trade and preventing the underreporting of goods. Annually, P3 billion is estimated to be lost to fraud. Illicit trade in tobacco and alcohol is believed to be a major contributor to the P3 billion tax revenue losses. Meanwhile, the Commissioner General of BURS, Jeanette Makgolo, has disclosed that the track and trace system tender is done on a ten-year self-liquidating process. Makgolo added that some players in the alcohol industry have embraced the system while others are still reluctant to do so. "We are happy with those who see need for this system," she said. [/ihc-hide-content]

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BURS Clamps Down on Tax Fraudsters

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