February 14, 2023
Botswana's Government presents 2023 Budget to Parliament
This Alert highlights the Budget Speech presented by the Honorable Dr. Peggy Serame, Botswana's Minister of Finance & Development (the Minister) to Parliament on 6 February 2023.
In her budget speech, the Minister emphasized that transformation requires time and thus the results thereof cannot be achieved in one budget cycle. Instead, each year's budget proposal represents, among others, positive steps taken to contribute towards the achievement of the transformation agenda.
She was upbeat about the performance and resilience shown by the Botswana economy that saw Botswana emerging with one of the fastest recoveries from the impact of the COVID-19 pandemic with an impressive Gross Domestic Product (GDP) growth rate of 11.8% recorded in 2021. The economic recovery has continued with strong GDP growth of 6.5% year-on-year over the first three quarters of 2022. For the full year of 2022, it is estimated that economic growth reached 6.7% despite the trailing effects of the Covid pandemic as well as the war in Ukraine.
On the development and growth agenda, the budget focused on the need to direct the bulk of the resources to areas that will significantly change the lives of Batswana, and create new, sustainable economic opportunities, i.e., infrastructure development budget, so as to unlock constraints to economic growth.
The Minister acknowledged the need to continue providing targeted support to sustain livelihoods. As a result, the Ministry is considering the following:
Some items that are currently zero rated/exempt from VAT that are no longer justifiable to remain on those lists may be removed.
A number of other fiscal interventions will also be implemented to reduce revenue leakages as well as improving the processes and capacity of the revenue authority to execute its mandate.
These measures include:
For the complete budget speech go to https://www.finance.gov.bw
For additional information with respect to this Alert, please contact the following:
Ernst & Young Advisory Services (Pty) Ltd, Gaborone
Ernst & Young Société d'Avocats, Pan African Tax — Transfer Pricing Desk, Paris
Ernst & Young LLP (United Kingdom), Pan African Tax Desk, London
Ernst & Young LLP (United States), Pan African Tax Desk, New York