M62 million loan for LRA modernisation project

Lesotho Times
4 Min Read
LRA Commissioner General Thabo Khasipe

Kaleen Chikowore

THE Lesotho Revenue Authority (LRA) has been granted a USD4.25 million (M62 million) loan by the Board of Directors of the African Development Bank Group.

The LRA Commissioner-General, Thabo Khasipe said the funds are a top -up to the initial USD7.09 million provided by the African Development Bank Group in 2017 towards the Lesotho Tax Modernization Project (LTMP).

Mr Khasipe added that LTMP is aimed at aiding LRA implement digital tax services, including e-registration, e-payment and e-filing will enable taxpayers to access LRA services online.

We have already engaged a Canadian company, C2D Services, for procuring software that is needed for the modification of the LRA system.

“We engaged C2D to help us put in place the backbone of the system that we intend to adopt.”

In an interview with the Lesotho Times Mr Khasipe said that the initial $7.09 (103 million) was used to finance and procure installations for the required software and hardware to enable e-registration, e-payment and e-filing, the e-invoicing component was not included on the initial fund.

“Under e-invoicing taxpayers will be able to pay using any financial institution. We have already engaged Standard Lesotho Bank, we intend to approach other banks.”

LRA however is waiting for the government to finalise the laws that will govern this initiative because the software that will be used under e-invoicing will be overseen by laws.

“E-invoicing is an ambitious project. It requires all Value Added Tax (VAT) registered entities in the country to install a particular software that will enable them to access the LRA systems. So, for them to be able to access the software there will be required to meet legal requirements that are yet to be finalised.”

He said that a The VAT (Amendment) Bill will be sent to parliament for review.

“We are hopeful that the bill will be passed so that taxpayers are able to transact without physically visiting LRA premises. The $4.25 million we sourced will be channeled only towards the procurement of the national e-invoicing system.”

Mr Khasipe said that LRA has already procured software for e-registration, e-payment and e-filing adding that the next move is to test the systems.

“The e-filing system will be tested before the end of the second quarter.

We are planning on implementing a pilot program to test the system with a few selected big institutions.

We are already finalising logistics with the selected businesses. They will start by submitting Pay as you earn (PAYE) while testing the system.

“The software and hardware that will lead to the integration of financial institutions and mobile money providers into e-payment systems is already in place.

Once a client makes a payment with any bank from any location in the country the information will reflect to both the platform that they would have used to make the payment as well as LRA in real time.

LTMP will enable LRA to know for instance the VAT collected for groceries on a particular day.

This will be an effective way to oversee taxing processes without paperwork.

“Under the e-payment service people will easily make payments either through banks or mobile money. LRA has already engaged Vodacom and Econet Telecommunications to allow people to pay via mobile money.”

Mr Khasiphe told the Lesotho Times that LRA is looking forward to venturing into data analytics to understand the behaviour of taxpayers. Full implementation of the whole programme is expected in  2023 .

E-Invoicing sends standard invoice data of trading partners from vendor system to customer system automatically.


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