09 Apr 2019
The Botswana Investment and Trade Centre (BITC) held a trade-centred event in South Africa last week, in an effort to discuss exporting more products from Botswana and attract investments from South Africa, City Press reports.
Botswana has initiated several pans to attract South African investment. When speaking to City Press on the sidelines of the event, BITC’s executive director for international business, Moshie Ratsebe, revealed that the diamond-rich country had offered investors competitive corporate taxes of 22%. This contrasts with the continent’s average of 27.5% and the global average of 23.57%.
The corporate income tax rate could be a mere 5% in key sectors, including manufacturing.
Botswana’s value-added tax (VAT) stands at 12% and the maximum personal income tax rate is 25%. In South Africa, VAT is 15% and the maximum personal income tax rate is 45%.
Additionally, Botswana offered tax holidays that could prolong till 10 years in specific situations.
Ratsebe said: “We have done a study to understand the South African market and identified a number of opportunities for 10 Botswana companies that we believe can export goods to South Africa and we have brought them here.”
Ratsebe also highlighted their goal of attracting investment to the town of Selibe Phikwe due to economic struggles caused by a mining operation shutdown, saying: “That area, which is in the eastern part of the country, has huge potential, especially with regard to tourism and agriculture.
“Government has put in place incentives to make sure we are able to save the economy of that area because it was heavily dependent on mining.
“Agriculture, tourism and general manufacturing are already there,” he noted.
Ratsebe went on to say that the mentioned sectors already boasted major tax incentives for investors.
“For us as a country, we think that we have always been misunderstood.
“A lot of businesses take a narrow view because of the small population of Botswana when actually they should be looking at it as part of the regional block,” he said, adding that Botswana’s perks included political and economic stability.
“We have demonstrated that we handle our economy very well.
“We have achieved the highest sovereign credit rating on the continent in the last few years.”