…misses annual target for 2023/24 fiscal year by 9%
…but collects more than the previous year
Leemisa Thuseho
THE Revenue Services Lesotho (RSL) has collected 8.87 billion in taxes despite missing the set target of tax collection for the fiscal year 2023/24 by 9.3 percent.
The taxman had set a target of M9.78 billion.
This was announced by the RSL Commissioner General, ’Mathabo Mokoko, yesterday at a media briefing held at the RSL Headquarters in Maseru.
Despite the failure to meet the target, Advocate Mokoko said they had managed to grow their revenue collection by 12.5 percent, compared to the previous fiscal year (2022/23’s collection.
In that year (2022/23), the RSL collected M7.83 billion.
“We were able to remit to the government of Lesotho M8.87 billion against the set target of M9.78 billion,” Adv Mokoko announced as she presented the RSL 2023/24 revenue performance report.
“However, I am pleased to announce that we grew our revenue collection for the 2023/24 financial year by 12.5 percent, relative to the collection of the previous financial year, despite having missed our target for the 2023/24 financial year by 9.3 percent.”
Adv Mokoko said the 2023/24 fiscal year had been one of the most challenging years.
She said it had been anticipated that economic growth would recover from global shocks which had a bearing on economic performance. However, that was not the case.
“The assumption was that our main tax types will grow in line with the projected economic growth at the beginning of the year, but the turnout has been different from what was anticipated.
“Economic outlook at the beginning of the financial year had depicted a projected growth of 2.1 percent but in reality, the economy grew by about 0.9 percent at the close of 2023, and this negatively affected the collections across the board.”
She added economic growth in the next fiscal year was expected to be anchored by Phase II of the Lesotho Highlands Water Project (LHWP), which picked up momentum from last year. However, she said the construction sector has had very little impact to the economy as it contributed only an average of 2.7 percent to the GDP, thus affecting the main tax types.
“The annual inflation rate was expected to average 6.6 percent in 2023, then gradually moderate to 5.3 percent and 5.0 percent in 2024 and 2025 respectively, since the supply and demand imbalances that drove inflation to record highs in 2022 were expected to gradually diminish.
“However, inflation is currently at 7.3 percent since February 2024. And this has negatively affected the collections from the wholesale and retail sector, hence less VAT collections as it (inflation) affected consumer spending patterns,” Adv Mokoko continued.
She said, despite the commendable performance, they were still troubled by the non-compliance of paying tax by some sectors.
“We have come to realise some isolated incidents of some taxpayers deliberately devising schemes to evade tax and defraud the government of Lesotho of its revenue. We are also concerned by taxpayers who under-declare their income or turnover.”
Despite the challenges, she said they had recorded some successes that included the registration of almost 1000 new taxpayers, mostly from the agriculture, retail and construction sectors in the 2023/24 fiscal year.
“We have made efforts to facilitate trade across the borders, increased the use of online platforms where 90 percent returns for almost all tax types could be submitted online.”
She said significant progress had been made under the Lesotho Tax Modernization Project.
“Under the E-Taxation, a fully-fledged e-filing solution has been successfully deployed for all tax types. The E-Payment and E-Registration solutions have also been completed. Starting from this financial year (2024/25) we will be implementing the E-Invoicing solution,” Adv Mokoko said.
She also announced that the period between 1 April and 30 June of every year marked a crucial period in their tax calendar because it was within this time that all taxpayers, resident and non-resident, were required to fulfil their tax obligations, by filing their tax returns and paying taxes due.
“This window of time provides individuals and businesses with the opportunity to ensure that their tax affairs are in order in line with the tax laws of Lesotho.
“I extend a resounding call to action to all taxpayers across Lesotho, irrespective of category or scale of operations, whether you represent a large corporation, a small or medium enterprise, a partnership, a sole trader, or an individual. If you have earned income during the 2023/24 financial year, it is imperative that you fulfil your civic responsibility by filing and submitting your income tax returns.
“Your compliance is not merely a legal obligation but a crucial contribution to the welfare of Basotho, especially the most vulnerable sectors of our society,” she said.
