Botswana has been under scrutiny from organizations such as Organisation of Economic Cooperation and Development (OECD), French government and Financial Action Task Force (FATF) in relation to secrecy laws in relation to sharing information with other countries.
In its 2017 report, the FATF stated that some Acts that aim at combating financial crime including the Income Tax Act have some limitations in relation to confidentiality of information exchanged, its protection, and use of the information for the purposes it was requested for. The worry was that there may be refusal by competent authorities to provide requested information under unreasonable or unduly restrictive conditions to courts or prosecuting bodies.
This has resulted in the country being grey listed by the FATF and has been under close monitoring by the FATF in relation to the deficiencies identified in our laws. The European Union also recently listed us in countries that may be blacklisted in October 2020 if it doesn’t address identified deficiencies.
Amending of secrecy law for Income Tax purposes may have been influenced by these developments and as the deadline comes closer for compliance it is not surprising that we have such a proposal including amendment of Acts such as Botswana Unified Revenue Service Act (which is mentioned in the report as one of the Acts to be strengthened).
Though there are some exchange of information provisions in various tax agreements Botswana has, there was worry that the current section 5(4A) had some limitations. The current subsection only references subsection 4 and doesn’t mention other sections in the Act or the whole Act. The phrase “…notwithstanding subsection (4)…..” has been replaced with “notwithstanding this Act or any other written law….” This now means the tax authority will not be limited by any section in this Act or any other law to provide information to other tax authorities or any other institution that needs such information whether within or outside the country.
The provision will supplement other available protocols such as the Southern African Development Community (SADC) exchange of information protocol and Article 25 of various double taxation avoidance agreements Botswana has with different countries. Some commentators though believe that the provision might be limited as it still references section 53 which deals with tax agreements the country has with other tax jurisdictions. The worry is that it may make it difficult for non-counterparts to access information as the same provision may be used by the authority to refuse releasing of such information where the countries do not have agreements or partnership of any form.
However apart from the tax agreements Botswana has some Tax Information Exchange Agreements (TIEAs) with some countries that are not in SADC and also do not have tax agreements with. There is also a tax information exchange manual that provides guidance on how such information is provided to whoever needs it. As parliament debates the bill in the coming weeks, we can rest assured that the passing of the bill as is or with some improvements such as allowing for a provision that caters for countries without tax agreements we will be moving towards the “white list”. Botswana will indeed be shedding off the tax haven tag and complying with the FATF and EU recommendations.
The past week or two has been a mixed grill of briefs in so far as the national employment picture is concerned. BDC just injected a further P64 million in Kromberg & Schubert, the automotive cable manufacturer and exporter, to help keep it afloat in the face of the COVID-19-engendered global economic apocalypse. The financial lifeline, which follows an earlier P36 million way back in 2017, hopefully guarantees the jobs of 2500, maybe for another year or two.
It was also reported that a bulb manufacturing company, which is two years old and is youth-led, is making waves in Selibe Phikwe. Called Bulb Word, it is the only bulb manufacturing operation in Botswana and employs 60 people. The figure is not insignificant in a town that had 5000 jobs offloaded in one fell swoop when BCL closed shop in 2016 under seemingly contrived circumstances, so that as I write, two or three buyers have submitted bids to acquire and exhume it from its stage-managed grave.
Youngest Maccabees scion Jonathan takes over after Judas and leads for 18 years
Going hand-in-glove with the politics at play in Judea in the countdown to the AD era, General Atiku, was the contention for the priesthood. You will be aware, General, that politics and religion among the Jews interlocked. If there wasn’t a formal and sovereign Jewish King, there of necessity had to be a High Priest at any given point in time.
Initially, every High Priest was from the tribe of Levi as per the stipulation of the Torah. At some stage, however, colonisers of Judah imposed their own hand-picked High Priests who were not ethnic Levites. One such High Priest was Menelaus of the tribe of Benjamin.
Parliament has rejected a motion by Leader of Opposition (LOO) calling for the reversing of the recent appointments of ruling party activists to various Land Boards across the country. The motion also called for the appointment of young and qualified Batswana with tertiary education qualifications.
The ruling party could not allow that motion to be adopted for many reasons discussed below. Why did the LOO table this motion? Why was it negated? Why are Land Boards so important that a ruling party felt compelled to deploy its functionaries to the leadership and membership positions?
Prior to the motion, there was a LOO parliamentary question on these appointments. The Speaker threw a spanner in the works by ruling that availing a list of applicants to determine who qualified and who didn’t would violate the rights of those citizens. This has completely obliterated oversight attempts by Parliament on the matter.
How can parliament ascertain the veracity of the claim without the names of applicants? The opposition seeks to challenge this decision in court. It would also be difficult in the future for Ministers and government officials to obey instructions by investigative Parliamentary Committees to summon evidence which include list of persons. It would be a bad precedent if the decision is not reviewed and set aside by the Business Advisory Committee or a Court of law.
Prior to independence, Dikgosi allocated land for residential and agricultural purposes. At independence, land tenures in Botswana became freehold, state land and tribal land. Before 1968, tribal land, which is land belonging to different tribes, dating back to pre-independence, was allocated and administered by Dikgosi under Customary Law. Dikgosi are currently merely ‘land overseers’, a responsibility that can be delegated. Land overseers assist the Land Boards by confirming the vacancy or availability for occupation of land applied for.
Post-independence, the country was managed through modern law and customary law, a system developed during colonialism. Land was allocated for agricultural purposes such as ploughing and grazing and most importantly for residential use. Over time some land was allocated for commercial purpose. In terms of the law, sinking of boreholes and development of wells was permitted and farmers had some rights over such developed water resources.
Land Boards were established under Section 3 of the Tribal Land Act of 1968 with the intention to improve tribal land administration. Whilst the law was enacted in 1968, Land Boards started operating around 1970 under the Ministry of Local Government and Lands which was renamed Ministry of Lands and Housing (MLH) in 1999. These statutory bodies were a mechanism to also prune the powers of Dikgosi over tribal land. Currently, land issues fall under the Ministry of Land Management, Water and Sanitation Services.
There are 12 Main Land Boards, namely Ngwato, Kgatleng, Tlokweng, Tati, Chobe, Tawana, Malete, Rolong, Ghanzi, Kgalagadi, Kweneng and Ngwaketse Land Boards. The Tribal Land Act of 1968 as amended in 1994 provides that the Land Boards have the powers to rescind the grant of any rights to use any land, impose restrictions on land usage and facilitate any transfer or change of use of land.
Some land administration powers have been decentralized to sub land boards. The devolved powers include inter alia common law and customary law water rights and land applications, mining, evictions and dispute resolution. However, decisions can be appealed to the land board or to the Minister who is at the apex.
So, land boards are very powerful entities in the country’s local government system. Membership to these institutions is important not only because of monetary benefits of allowances but also the power of these bodies. in terms of the law, candidates for appointment to Land Boards or Subs should be residents of the tribal areas where appointments are sought, be holders of at least Junior Certificate and not actively involved in politics. The LOO contended that ruling party activists have been appointed in the recent appointments.
He argued that worse, some had no minimum qualifications required by the law and that some are not inhabitants of the tribal or sub tribal areas where they have been appointed. It was also pointed that some people appointed are septuagenarians and that younger qualified Batswana with degrees have been rejected.
Other arguments raised by the opposition in general were that the development was not unusual. That the ruling party is used to politically motivated appointments in parastatals, civil service, diplomatic missions, specially elected councilors and Members of Parliament (MPs), Bogosi and Land Boards. Usually these positions are distributed as patronage to activists in return for their support and loyalty to the political leadership and the party.
The ruling party contended that when the Minister or the Ministry intervened and ultimately appointed the Land Boards Chairpersons, Deputies and members , he didn’t have information, as this was not information required in the application, on who was politically active and for that reason he could not have known who to not appoint on that basis. They also argued that opposition activists have been appointed to positions in the government.
The counter argument was that there was a reason for the legal requirement of exclusion of political activists and that the government ought to have mechanisms to detect those. The whole argument of “‘we didn’t know who was politically active” was frivolous. The fact is that ruling party activists have been appointed. The opposition also argued that erstwhile activists from their ranks have been recruited through positions and that a few who are serving in public offices have either been bought or hold insignificant positions which they qualified for anyway.
Whilst people should not be excluded from public positions because of their political activism, the ruling party cannot hide the fact that they have used public positions to reward activists. Exclusion of political activists may be a violation of fundamental human or constitutional rights. But, the packing of Land Boards with the ruling party activists is clear political corruption. It seeks to sow divisions in communities and administer land in a politically biased manner.
It should be expected that the ruling party officials applying for land or change of land usage etcetera will be greatly assisted. Since land is wealth, the ruling party seeks to secure resources for its members and leaders. The appointments served to reward 2019 election primary and general elections losers and other activists who have shown loyalty to the leadership and the party.
Running a country like this has divided it in a way that may be difficult to undo. The next government may decide to reset the whole system by replacing many of government agencies leadership and management in a way that is political. In fact, it would be compelled to do so to cleanse the system.
The opposition is also pondering on approaching the courts for review of the decision to appoint party functionaries and the general violation of clearly stated terms of reference. If this can be established with evidence, the courts can set aside the decision on the basis that unqualified people have been appointed.
The political activism aspect may also not be difficult to prove as some of these people are known activists who are in party structures, at least at the time of appointment, and some were recently candidates. There is a needed for civil society organizations such as trade unions and political parties to fight some of these decisions through peaceful protests and courts.