Business

Govt removes VAT on salt, pads, veggies, cooking oil, diapers

Mbongeni Mguni | Wednesday February 22, 2023 14:49

Basic commodity: VAT on cooking oil was reduced to 12% from 14% between August and the beginning of February. The new amendments will scrap it entirely
 
Basic commodity: VAT on cooking oil was reduced to 12% from 14% between August and the beginning of February. The new amendments will scrap it entirely

According to a notice in the government gazette, the Ministry also wants to zero rate agricultural implements and condoms while exempting private health services from charging VAT. The proposed amendments to the VAT Act come after Finance Minister, Peggy Serame, in her recent budget speech, said zero- rating would be rolled out on certain projects in order to provide targeted support to sustain livelihoods. The minister said list of VAT zero-rated or exempted items was being reviewed in order to include some and in future remove those whose inclusion is no longer justifiable.

The latest developments will be welcomed by Batswana who have long questioned why basic necessities such as certain food products, baby items and sanitary wear should be charged VAT. Tax experts have however cautioned that exempting rather than zero rating private health services from VAT could ultimately increase the cost to patients, as the affected practitioners will be unable to recoup any VAT they pay on goods and services supplied to them.