THE Commissioner General of the Lesotho Revenue Authority (LRA), Thabo Khasipe, says the inaugural 2018 Tax Expo generated valuable feedback towards re-shaping the country’s tax policy.
Mr Khasipe said the 2018 came up with recommendations that have since been followed up by the government towards improving the tax policy.
Mr Khasipe said this yesterday while addressing guests at the opening of this year’s edition of the expo in Maseru.
The LRA introduced the Tax Expo in 2018 to provide a platform for all stakeholders to discuss tax policy formulation and tax administration. This was done to unlock the potential of tax policy as a driver of economic growth and development.
The expo is also used to discuss current regional economic challenges caused by volatile and generally declining Southern African Customs Union (SACU) revenues. It also underscores the need for Lesotho to strengthen its capacity on domestic resource mobilisation initiatives to finance government expenditure.
Addressing the guests yesterday, Mr Khasipe said the initiative emanates from the LRA’s mandate to advise the government on tax issues.
“We had the first Tax Expo last year, which produced very enthusiastic and lively conversations,” Mr Khasipe said.
“I vividly remember the session emphasised a lot on the expenditure of tax revenue as the driver of the revenue collection… That was a clear theme that emerged from the highly charged debate we had last year.
“Other issues related to the use of our natural resources and how we can derive benefit from them as a nation while also ensuring that the investors who have taken risk to come to our country to invest get a fair return on their investment.
“…As a result, there were specific recommendations that were tabled to honourable minister (Finance minister Moeketsi Majoro) and some ended up in his budget speech; most notably the fact that we are looking at exemption rather than zero- rating mining business operations.”
He said this year’s session would include deliberations on usage if taxation to stimulate investment promotion.
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“A new session that we are introducing this year relates to investment promotion and the use of taxation as an instrument of attracting foreign direct investment.
“Here we are asking do we sometimes sit back and reflect on a cost benefit analysis on some of the concessions that we give to say are they really justifiable, are they reflecting a return in the sense of the intended benefits employment creation, economic growth they spur, and revenue collection that accrues to the nation?
“That is the conversation we are expecting to have as a new session this year.”
For his part, Dr Majoro said the expo would play a key role in the economic reforms section of the national reforms agenda.
“This should give a clear direction to how we can break the vicious cycle of having many opportunities but not being able to bring them together for the benefit of the economy,” Dr Majoro said.