The government wants a tax system built for the digital age, but the task of making it work will fall largely on the Botswana Unified Revenue Service. At the Tax Pitso, a national consultation on tax reform, Phodiso Valashia, the acting commissioner-general, described the moment as a reset for both taxpayers and the tax authority.
“At present, Botswana’s tax collection to GDP ratio stands at approximately 13%,” Valashia said. The goal is to raise that to at least 18% in the near term and above 20% thereafter, a jump that will require stronger enforcement, better systems and wider compliance.
The pressure comes from the country’s changing economic reality. Ndaba Gaolathe, the vice-president and finance minister, said Botswana can no longer rely on the mineral revenues that once funded much of its development. “Declining mineral revenues, global uncertainty and rising demands for social services have placed increasing pressure on our public finances,” he told delegates.
The government’s economic strategy depends on making the new system work. As diamond income becomes less reliable, Botswana must fund infrastructure, energy projects and social programmes increasingly from its own tax base.
To respond, the government is rewriting key tax laws and introducing a new Tax Administration Act intended to harmonise procedures across income tax and VAT. The reform also extends VAT to digital and remote services, an area the minister said the current system fails to cover. “Our VAT regime was designed for a traditional economy,” Gaolathe said. “It is no longer adequately equipped to address the growing digital economy.”
Valashia argued that legal reform will mean little without operational change. BURS plans to close revenue leakages by strengthening controls, expanding automation and using artificial intelligence to detect non-compliance. “Full digitalisation, including the use of advanced data analytics, will enhance transparency and reduce discretion,” he said.
The revenue service is also preparing to introduce electronic VAT invoicing and real-time transaction monitoring, tools already used in several emerging economies to improve compliance. Such measures, Valashia said, are necessary because voluntary compliance alone will not deliver the revenue the country needs.
Yet both speakers stressed that enforcement must be matched by credibility. Gaolathe warned that taxpayers will resist reform if they believe public money is wasted. “Citizens and businesses are more willing to comply when they see that public resources are managed prudently,” he said.
Valashia echoed the point from the tax authority’s side, acknowledging past failures and promising a change in approach. “There have been system gaps, delays in resolution and weaknesses in governance,” he said. “Because a tax administration that is not trusted will not be supported, and one that is not supported will not perform.”
The government’s economic strategy depends on making the new system work. As diamond income becomes less reliable, Botswana must fund infrastructure, energy projects and social programmes increasingly from its own tax base.
Valashia summed up the stakes in practical terms. “If revenue is not realised at the level required, projects slow down, delivery is delayed and opportunities are lost,” he said. In the new fiscal reality, the country’s development plans will depend less on what lies underground, and more on what can be captured in the tax system.
