|March 28, 2002
NAMIBIA: 1% tax rate for absentee landlords
Namibian government on March 27 proposed slapping a 0,75 per cent tax
rate on the value of each hectare of undeveloped land owned by commercial
farmers in Namibia and one per cent on land owned by absentee landlords.
The move is aimed at compelling farmers to sell their excess land to
Government for resettlement. Lands, Resettlement and Rehabilitation Minister
Hifikepunye Pohamba introduced the proposed land tax in the National Assembly
and called on Members of Parliament to support the move. Pohamba had earlier
announced that the land tax would be introduced on April 1 (Monday), but on
March 27 there was still no indication whether this would still be the case
after debate on the matter was adjourned to Tuesday, April 2.
Through the proposed land taxation, Pohamba said, Government would be
able to raise revenue of at least N$ 18,4 million each year. He said the tax
rate for absentee landlords was likely to be pushed up after one year when a
re-evaluation of the rates would be done. Pohamba said the tax rate would
increase by 0,25 per cent per hectare on each additional farm owned by an
individual commercial farmer. Under the proposed tax rate, a Namibian farmer
will pay 0,75 per cent per hectare value and 0,25 per cent per hectare value
will be added for each additional farm a person owns. It is not clear what role
the size of farms will play and how the agro-ecological zones helped to
determine the tax rates.
When he made his first announcement on land tax in February, Pohamba
said a fixed rate would be determined by the National Assembly. On top of the
fixed rate, farmers would be taxed according to which agro-ecological zone
their land falls in and the carrying capacity of each farm. Agro-ecological
zones are determined by factors such as how much rain an area receives. Farmers
will not be taxed on improvements they have made on their farms.
Pohamba said that Government identified 12.325 taxable commercial
agricultural properties in Namibia and that ownership was broken up into land
owned by Namibians and land owned by non-Namibians. "In most cases,
non-citizens own large tracts of land. These tracts of land are either
completely neglected and held for speculative purposes or are grossly
under-utilised," he said. Because such land was under-utilised, Pohamba said,
his Ministry proposed imposing a one per cent tax rate on land in the hands of
absentee landlords. Based on a 60 per cent collection success rate and judging
by the implementation of similar tax elsewhere, Pohamba said Government
expected to raise around N$18,4 million over the next 12 months.
Pohamba's proposal came under fire from Swapo MP Ponhele ya France who
suggested that the objective be to grab land instead of forcing people off it
through land tax. He said although the land tax would undo the injustice
against Namibians by Europeans who took their land, it was best to repossess
the land without any compensation. "Some of us have nowhere even to be buried.
This must be corrected," he said. Ya France suggested that Government should
not tax formerly disadvantaged people who bought land under an affirmative
action loan scheme. (The Namibian)