Future of taxation in Namibia

As Namibia enters a new era of economic opportunity, from green hydrogen to digital transformation, the need for a modern, responsive and integrated tax system is becoming increasingly urgent. The latest edition of the Business Breakfast Club, hosted under the ongoing theme “The Future – Envisioning Tomorrow”, brought together leading voices from across the financial, legal, and business sectors to explore how tax and technology can work hand in hand to support national development and drive investment.

Held once again at the Stellenbosch Wine Bar and Bistro, the conversation unpacked everything from risk-based audits to open APIs and the potential of artificial intelligence in tax administration. While the topics were technical, the impact is deeply practical — for businesses of all sizes, for revenue collection, and for how Namibia positions itself on the global investment map.

One of the standout messages from the morning was the need for a smarter, more data-driven approach to compliance and enforcement. Drawing comparisons to models used in the Netherlands and elsewhere, panellists highlighted how advanced analytics could help tax authorities audit based on actual risk rather than outdated assumptions. Currently, any company claiming a refund is likely to be audited, regardless of their reputation or compliance history. In the future, with more data and better algorithms, that could change. Large, reputable institutions such as banks, which have strong internal controls and significant reputational risks, should not face the same level of scrutiny as highrisk or non-compliant entities. This shift toward targeted oversight is not only more efficient but also improves trust in the system.

Technology was another recurring theme. Namibia’s existing tools, like the e-tariff portal for import duties, were praised for their utility and accessibility. However, attendees noted that the country has not yet embraced full digital integration. The use of APIs, application programming interfaces that allow business systems to connect directly with the revenue authority, was discussed as a major opportunity for streamlining tax compliance. In neighbouring South Africa, such integration already enables users to make payments, submit filings, and verify data with minimal friction. In Namibia, companies still rely on EFTs with reference numbers, manual uploads of proof of payment, and other steps that could be easily automated. Unlocking these efficiencies would benefit both the revenue authority and businesses, reducing errors, delays and administrative burdens.

Incentives and exemptions were also hotly debated. While green hydrogen has received significant tax breaks and import duty concessions, other industries such as mining, upstream oil and gas, and manufacturing are still waiting. The panel agreed that Namibia’s tax policy should not favour one sector to the exclusion of others, especially when those sectors are capital-intensive and job-creating. The upcoming Special Economic Zone (SEZ) legislation, expected before the end of 2025, could present a chance to level the playing field. The SEZ framework is anticipated to replace the phased-out Export Processing Zone (EPZ) regime and revive many of the manufacturing incentives that once attracted foreign direct investment into the country. There was consensus that in order for these zones to be effective, they must offer practical relief such as upfront import duty exemptions to ease the cash flow burden on companies investing hundreds of millions in equipment and infrastructure.

The conversation also touched on the prospect of introducing a capital gains tax in Namibia. Drawing from South Africa’s two-decade experience, speakers argued that the revenue potential may not justify the complexity. Capital gains tax tends to generate relatively low collections, yet requires significant administrative resources and legislative changes, including a shift to residency-based taxation. Such a move could deter investment and complicate compliance for businesses and individuals alike. In a country where simplicity is one of the key selling points of the tax system, this could be counterproductive.