New tax structure misinterpreted – MoTI

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OBFC director Monaheng Monaheng

By Mateliso Phulane

The Ministry of Trade and Industry has taken note of the distortion of facts circulating on social media regarding the new tax. This came after implementation of the Business Licencing and Registration Act which will regulate the businesses starting from August 1 2022.

Some of the changes are an introduction new taxes for micro, small and medium enterprises and large scale businesses and the transition period for the foreigners that are operating in the reserved businesses.

Commenting on the matter on Wednesday this week the director of the One Stop Business Facilitation Centre at the ministry, Monaheng Monaheng said it seemed that the new tax rates found in the business Act brought a lot of confusion to the people hence they misinterpret them badly on social media platform.

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“We have made categories of businesses which will be licenced and those which will just be registered hence the taxes will also differ. Those which will be registered will pay an amount of M500 and will be renewed after a period of three years.

Traders should be aware that those which are registered will no longer require traders licence.

Apart from that, businesses which will be licenced will be charged M3 000 and therefore they have to be renewed annually, Monaheng said.

However, tax structure has been written and spread interchangeable in the social media that those which are registered will pay M3000 instead of M500.

He said such misinterpretation has really caused an inconvenience which really concern them as the ministry.  

Monaheng said the regulations also provide for business activities which are exclusively reserved for the citizens of Lesotho. This will give Basotho an opportunity to grow their businesses in other sectors without fear of facing stiff competition from foreigners. Such businesses includes transport and logistics, restaurants, warehousing and others.

“Basotho have approached us, urging that they should be given an opportunity to run such businesses hence they are now capable of doing so. Such people will be given a period of 12 months to prepare and also give us a pipeline in order to identify such businesses,” he observed.

On-line services for licensing and registration application process can be done electronically. This makes the procedures short and fast and will save business operators time and money as applications are considered as soon as they are lodged.

In conclusion, he said the ministry is committed to enhance trade for all and continue to develop legislation that makes it easier to do business in Lesotho. The Business Licensing and Registration Act brings about changes to trade landscape, which aims to create an enabling environment for business and investment in the country.

Apart from that, the Project Manager at the Private Sector Competitiveness and Economic Diversification Project (PSCEDP) Chaba Mokuku said this project which was established under the ministry of trade and industry have developed new strategic plans with the aim of improving the MSMEs entrepreneurs especially women and youth. It also aims to resuscitate the economy of the country after the Covid 19 pandemic.

“The project development objective is to increase access to business support services and financial products targeted at MSMEs and entrepreneurs, especially women and youth.

 They include farmers in fruit production and those involved in apparel and clothing business.

Mokuku further indicated that this new strategic plan will financially assist small businesses during the disastrous period. But the businesses will have to register since they will also improve means of technology for the business owners.

This project which is sponsored by the World Bank has been allocated the amount of M750 million.