MEFMI Facilitates Consultative Meetings to Namibia National task Force on Establishing an Independent Revenue Authority

In its quest to establish an independent revenue agency, the Namibia National Task Force has been making consultations on the process. Part of that process was a consultative meeting which MEFMI coordinated for Dr. Bennie Zaaruka, a member of the task force.

Dr. Zaaruka, who is also a MEFMI Graduate Fellow had the opportunity to meet experts on tax and tax administration at a MEFMI workshop which was held in Kigali, Rwanda in early November 2014. MEFMI also arranged a meeting for Dr. Zaaruka with the Rwanda Revenue Authority (RRA) where she met the Commissioner General, Mr Richard Tusabe. The meeting was also attended by MEFMI Director – Macroeconomic Management Programme, Dr. Sehliselo Mpofu and MEFMI Programme Office, Mr. Amos Cheptoo.  

Dr. Zaaruka briefed the RRA team on the status of establishing an independent revenue agency in Namibia and sought clarification and information on key governance and policy issues to assist the Namibia Task Force finalize the policy framework. Dr. Zaaruka further briefed the Commissioner General and the MEFMI team on progress that Namibia had made towards setting up the policy framework, which she said was ready and undergoing refinement before being presented to Cabinet.

The Commissioner General stated that RRA was an implementing agency for tax and revenue policy in Rwanda and that tax policy administration was a function of the Ministry of Finance. He also outlined the structure of the Tax Department, including that of the Board. He explained that the inclusion of the various stakeholders on the Board was to ensure that there is policy consistency and harmonisation. To enhance performance and accountability, the Commissioner General stated that the Chairman of the Board signs a performance contract with the Ministry of Finance while the Commissioner General signs with the Board.

He also pointed out that the RRA has semi-autonomous powers which make it fit into the Public Service but operating under different independent statutes that makes it an independent employer. In terms of establishment, the Commissioner General said that RRA had 1000 staff but was planning to recruit an additional 200 to collect property tax at the local authority level which was currently ineffective. He also pointed out that there was a police unit in RRA which reports to the Commissioner General and has a revenue protection function of helping in enforcing and providing checks and balances.

The Commissioner pointed out that from his point of view, the strength of the proposed Namibian revenue authority lies in the country’s ability to have a strong tax policy unit at the Ministry of Finance with a clear mandate from a policy perspective so that the revenue authority is not bogged down with revenue policy work. He stated that this would allow the agency to concentrate on revenue collection. He also said that capacity building was critical for all staff. He said that the RRA had a training institute for its staff.

The Commissioner General further stated that controversial issues that needed to be clarified relate to who sets the revenue target. He pointed out that there was need for the revenue agency to have a scientific way of forecasting revenue. He noted that in Rwanda, staff get 10% of revenue collected above target. He further pointed out that the South African Revenue Authority (SARS) is helping Rwanda develop the forecasting framework. In terms of public relations, RRA had a tax payer’s service department for educating tax payers.