Botswana Sectors of Educators Trade Union (BOSETU) has condemned the government’s decision to increase and introduce a number of taxes. Speaking during their press conference this morning, BOSETU National Treasurer- Samuel Odirile vehemently condemned government’s economic recovery measures which were presented by the minister of Finance and Economic Development-Dr. Thapelo Matsheka recently.
“We appreciate the challenges that the government is facing in raising the required revenue to finance the budget, we know in the last financial year we were running with a budget deficit, and we know the challenges that has always been communicated, but we do not think the timing is right for the raising of the VAT (Value Added Tax) with two percent (2%) take points, an implementation of levy on sweetened beverages, fuel levy and plastic levy, and introduction of levy on second hand vehicles imported into Botswana”
BOSETU is of the view that the teachers and Batswana in general are at their weakest point financially due to the impacts of COVID-19. Further Odirile says that increased taxes and levies could lead to inflation and also have an impact on slowing down the growth of the economy. According to BOSETU, taxes and levies could have been delayed until post-COVID-19 period. “With the current high income inequality, such regressive tax and levy measures will do more harm to the poorer households and increase the already worse income inequality of the country, we therefore urge the government to postpone the fiscal changes. In this current period of crisis households and workers need support from government rather than being required to lose more of their limited resources to government during crisis.” Odirile charged.
“Government should generate streams of making money which are sustainable instead of turning to citizens who are already low paid and already struggling.”
Samuel Odirile, BOSETU National Treasurer
Instead of imposing taxes and levies, Odirile says that the government should look into diversifying the economy and implementing the much talked about ‘export-led economy’, “Government should cease to talk of export-led growth only in rhetoric, they should be talking of certain industries that they convince us that they are actually going to produce exports” Odirile said, giving an example of Lobatse industry leather park project saying is one of the streams government should really be utilizing.
Adding on Odirile said, “Government, talks of export-led growth, but have failed to note which areas/goods we are targeting to export so that we increase exports in this regard.”
“BOSETU is worried that the government seems to have given up in trying to diversify the economy to generate the growth and revenue and instead it has turned to its ordinary citizens to directly increase its purse” he said. Odirile says that the government instead should consider borrowing.
Commenting on the drastically declined Government Investment Account (GIA), Odirile says this decline which happed in a short span of time is “worrisome as it implies the economy now stands in a relatively weak position to withstand any further shocks” he further expressed a concern that in spite of the decline in the GIA, the “budget speech does not detail the main import expenditure which would have helped rationalizing the expenditure especially that it is said the significant amount was used to procure COVI-19 related equipment like Personal Protective Equipment (PPE)”
Also noting with concern, BOSETU observed that the liquidation of some parastatals/state owned enterprises which are said to be underperforming may lead to job losses and possible increase in the dependency ration as a result of a jobless growth economy.
