mid-year budget 2019/20 review highlightspwc 2019/20 mid -year budget review. october 2019. 2019/20...
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2019/20 Mid-Year Budget ReviewHighlights
October 2019
PwC October 20192019/20 Mid-Year Budget Review
2019/20 Mid-Year Budget Review
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PwC October 20192019/20 Mid-Year Budget Review
OverviewThe Minister of Finance presented the Mid-Year Budget Review Policy Statement in Parliament on the 22nd of October 2019. This overview summarises highlights from the speech.
2019/20 Mid-Year Budget Review
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“The economic and fiscal environment has changed and remains dynamic. Our economy, as small it is, remains resilient in
challenging times.” – Hon. Calle Schlettwein, Minister of Finance
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Budget Comparisons (N$ Millions)Total Revenue Comparison
Chantell HusselmannPartner
Tax Leader / Indirect Tax [email protected]
Revenue collection is on track for the first half of the year, with a Mid-Year revenue out-turn amounting to N$29.4 billion. This is estimated to be 50% of the budgeted revenue and about 2% better than the average half-year collection rate. Revenue for the FY2019/20 is expected to remain unchanged at the budgeted N$58.4 billion, 28.8% of GDP.
58,659
56,341
58,397 58,406
55,000 55,500 56,000 56,500 57,000 57,500 58,000 58,500 59,000
Actual Prel iminary Proposed (Annual)
Revised (Interim)
2017/18 2018/19 2019/20 2019/20
REVENUE COMPARISON (N$ MILLION)
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Budget Comparisons (N$ Millions)Revenue Analysis
2019/20 Total Revenue is estimated to be N$58.4 Billion of which N$3.7 Billion is Non-Tax
Revenue
19,597
17,375
18,917 18,917
16,000
16,500
17,000
17,500
18,000
18,500
19,000
19,500
20,000
2017/18(Actual)
2018/19(Prelim)
2019/20(Annual
Proposed)
2019/20(Revised Interim)
SACU RECEIPTS (N$ millions)
Income Taxes on Individuals
25% Company Tax14%
Property & Other Taxes
2%
Indirect taxes24%Customs & Excise
35%
TAX REVENUE (COMPOSITION): 2019/20 REVISED
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Budget Comparisons (N$ Millions)Total Expenditure Comparison
Johan NelPartner
Corporate Tax and Legal [email protected]
The half-year expenditure execution was 46% of the budget, amounting to N$30.6 billion. The half-year expenditure execution (excluding interest) was 52%. Development budget implementation rate at September 2019 is 37%. Interest rate payments approximates 11% of revenue.
67,523
65,104
66,550 66,550
63,500 64,000 64,500 65,000 65,500 66,000 66,500 67,000 67,500 68,000
Actual Preliminary Proposed (Annual)
Revised (Interim)
2017/18 2018/19 2019/20 2019/20
Expenditure Comparison (N$ Million)
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Budget Comparisons (N$ Millions)Major expenditure reallocations
N$211 mil N$88 mil N$88 mil N$ 67 milN$184 mil N$97 mil
To Health and Social Services
To Poverty Eradication and Social
Welfare
To Gender Equality and
Child Welfare
To Office of the Prime Minister (Drought
Relief)
To Education, Arts and Culture
To Agriculture, Water and Forestry
Freed up funds amounts to N$1.18billion, comprising of N$999.59 million
from the development budget and N$176.32 million from the operational
budget.
N$ 36 mil
To Home Affairs and Immigration
(Visa Stickers Project)
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Budget Comparisons (N$ Millions)Total Deficit Comparison
Riana EsterhuyseAssociate Director
Corporate Tax and [email protected]
The 2019/20 Mid Year budget review reflects a budget deficit that has decreased from 4.7% to 4.1% of GDP over the first half of the year. Estimated to reach 2.5% of GDP by FY2022/23.
8,864 8,763
8,153 8,144
7,600
7,800
8,000
8,200
8,400
8,600
8,800
9,000
Actual Preliminary Proposed(Annual)
Revised (Interim)
2017/18 2018/19 2019/20 2019/20
Deficit Comparison (N$ Million)
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Budget Comparisons (N$ Millions)Total Debt Comparison & Expenses Composition Expenditure
as a % of GDP stands
at
33.6%
Debt as a % of GDP
stands at
49.0%
74,468
87,533 96,271 96,934
Actual Preliminary Proposed (Annual) Revised (Interim)
2017/18 2018/19 2019/20 2019/20
Total Debt (N$ Million)
8%
14%
7%
21%
50%
EXPENDITURE BY MAIN (REVISED AVAILABLE BUDGET)
Administrative Economic Infrastructure Public Safety Social
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Main Income Tax Legislation ProposalsEstablishing of the Special Economic Zone, eliminating current tax incentives for manufacturers and exporters of manufactured goods
Specific taxation of trusts
Investigating lower tax regime for small business
Taxing of certain commercial entities
Conclude research on improving tax revenues from extraction sectors
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Main Indirect Tax Legislation Proposals
02VAT Zero rating of certain goods
Indirect Tax Proposals
Eliminating certain base eroding exemptions
03Export levy expansion to
incentivize local value addition
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Questions? Contact one of our tax experts below:
The information contained in this booklet is based on current Namibian legislation and practice as well as the 2019/2020 Budget speech of the Minister of Finance. Amendments after publication of this brochure as well as the DIR's departmental practice may lead to further changes. This brochure is intended for general information only and does not deal exhaustively with any topics. No responsibility can be accepted for any errors or loss, however caused or sustained. The firm's partners should be contacted for tax planning issues.
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Chantell HusselmannPartner
Tax Leader / Indirect Tax [email protected]
Johan NelPartner
Corporate Tax and Legal [email protected]
Riana EsterhuyseAssociate Director
Corporate Tax and [email protected]
As concluded by the Honourable Minister of Finance“Nothing happens until the pain of remaining the same, outweighs the pain of change.” - Arthur Burt