It is time for the finance minister to cut the goose that lays the golden egg some slack.

The individual taxpayer is under severe strain, with some paying up to a third of their income to tax.

Those lucky enough to still be gainfully employed after the ravishes of Covid-19 and over five years of economic decline are so heavily taxed that the little they have left is further eroded by increasing payments for mortgages and car loan repayments, as well as food and other goods becoming increasingly more expensive.

In 2020, the average price for both diesel and petrol in Namibia was N$12 per litre. For two years since then, the price has almost doubled, placing an unrelenting burden on all Namibian consumers as the fuel price has a huge knock-on effect on the price of all other goods and services. 

Providing relief will not be easy, as the minister’s options are limited and shrinking.

However, businesses only contribute about 25% of the Treasury’s purse, but the government has bent over backwards to offer businesses relief and loans at favourable rates during and post-Covid-19. Individuals contribute around 45%, but have seen no love from this finance minister. 

For the financial year 2021/22, Namibia’s share of the Southern African Customs Union (SACU) receipts declined by about 34% to N$14.8 billion, down from N$22.3 billion in 2020/21.  

This contribution continues to suffer because the average taxpayer has been forced out of spending on consumables.

Meanwhile, the Bank of Namibia has, despite the obvious, continued to make debt more expensive for the average Joe, and that stifles the average consumer’s ability to buy.

In the end, only the banks, mostly foreign-owned, smile all the way to the bank.

It’s time the central bank lets go of this theory that hamstrings and impoverishes the individual taxpayer and only enriches the banks.

The continual rise of the repo rate has not only eroded the potential for financial planning, but will strengthen calls to unpeg the dollar from the rand. These decisions are not made by the monetary policy committee, but rather are necessary to remain on par with the South African Reserve Bank. An independent entity which is taking cues from western economies with different realities. Those making decisions for the average person are insulated from these decisions and, therefore, are careless with the meagre finances of the average Namibian. Not only are tax cuts necessary, but an entire overhaul of the system is required. 

In no way, shape or form has trickle-down economics been successful at anything other than trickling more wealth into the pockets of the already super-rich.

The minister, in his 22 February budget speech, probably already written by now, should have major relief for his biggest contributor.

He has several options:

Raise the current N$50 000 threshold to at least N$90 000, or even N$150 000.

This still does not help those whose annual earnings are under the threshold.

A universal basic income grant has been talked about for some time, and there has been serious political pushback against the idea. But some of the food bank recipients are now receiving a cash grant. A basic income grant could help those under the threshold. Frankly, it has become a necessity. 

The minister could also more aggressively tax tobacco, including vape products, and alcohol as well as luxury vehicles, especially the gas guzzlers. 

Some abandoned ideas by Shiimi’s predecessor are the solidarity wealth tax and tax on commercial income from not-for-profit institutions like private schools and churches. The super-wealthy should pay their fare share, and profit-making churches are mushrooming. Let them pay tax.

He should also sign up those with taxable income who are not yet on the Namibia Revenue Agency’s (NamRA) books, especially in rural areas, and encourage NamRA to aggressively pursue those who actively dodge tax, and the hordes of businesses who have so far fallen through the cracks.

These are some of the various options for the minister to ponder as long as he prioritises giving the individual taxpayer some breathing space.