Farmers’ tax exemption bleeds govt by N$40m

July 3, 2015, 9:19am

Farmers’ tax exemption bleeds govt by N$40m

The government has lost approximately N$40 million in Inland tax revenue after granting farmers tax relief measures during the 2012/2013 financial year, Land Reform Minister Uutoni Nujoma has revealed.
He said in the National Assembly last week that the tax exemption, which was granted to all farmers in the country, was prompted by the severe drought experienced during the same financial year.
The amount has been forgone by government giving 7000 farmers a subsidy and relief to recognise their investment priorities.
 Nujoma said the ministry has started a sub- programme for valuation, property taxation and estate management aimed at strengthening the land valuation and taxation regulations on commercial agricultural land.
Since its inception in 2011, it has collected N$257,2 million through land tax to the benefit of land acquisition and development, while during the 2013/2014 tax year, an amount of N$2,8 million was collected by June 2014.
“For the efficient management and administration of this sub-programme, the ministry requires an additional N$14,2 million”, Nujoma stated.
While highlighting some of the ministry’s achievements on the acquisition of farmland, he said they have acquired 40 commercial farms valued at N$257 million measuring 210 987,25 hectares on which 90 families have already been resettled.
“The redistributive land reform programme continues to be a priority of the State. Though many Namibians have been resettled and others have benefited from other government schemes to get access to land, it is important to note that due the demand for land, the ministry has acquired 2,7 million hectares of land to date,” he said.
Nujoma further stated that to meet the set target of five million hectares by 2020, the ministry still needs to acquire 2.3 million hectares, which translates to an annual acquisition target of 200000 hectares, adding that the ministry has managed to exceed the set annual target by 5% during the 2013/2014 financial year.
“While we have made great strides in the acquisition of farmland, the price at which agricultural land is sold to the government remains a concern, and we are looking for means to address the matter” he noted.
According to Nujoma, a study carried out by the ministry last year confirmed that the prices offered  to the State are not the same as those at which the same land is sold to private individuals, adding that they also found that farms sold to Affirmative Action beneficiaries are also pegged at much higher prices.
The minister furthermore revealed that during the 2014/2015 financial year, the ministry developed and rehabilitated 26 resettlement farms in the !Karas, Hardap, Khomas, Erongo, Kunene and Oshikoto regions.
However, to continue with the implementation of the sub-programme for land acquisition, the ministry requires an additional N$14,9 million.
Nujoma explained that commercial farms are set up in a manner that the State buys a single farm from a family, which is then sub-divided and allocated to an average of four families. Hence the need to provide and in some cases extend existing water infrastructure to the various households.
“The cost of water rehabilitation is due to various factors, and I intend to look into various options to rehabilitate water infrastructure on farms in a cost-effective manner”, he added.
The ministry also needs N$3,8 million to implement their fencing infrastructure sub-programme, whilst they have rehabilitated fencing on four farms in the Hardap and Otjozondjupa regions.

by Hileni Heita