Income Tax (Amendment) Act 2014

Year of Act: 
2014
Number of Act: 
33
Date of promulgation: 
13 June 2014
Date of commencement: 
01 April 2014

 

           LESOTHO GOVERNMENT GAZETTE

EXTRAORDINARY

Vol. 59                                  Friday -  13th June, 2014                                 No. 33

 

 

CONTENTS

 

 

No.                                                                                                                      Page

 

 

ACT

 

 

 

2       Income Tax (Amendment) Act, 2014                                                       559

 

 

 

GOVERNMENT  NOTICE

 

 

 

39     Statement of Objects and Reasons of the                                                560

Income Tax (Amendment) Act, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

Published  by the Authority of His Majesty the King

Price: M3.50

 

 

 

 

559

 

 

ACT NO.2  OF 2014

 

Income Tax (Amendment) Act, 2014

 

 

To amend the Income Tax Act, 19931  to adjust the tax rates prescribed  in the

Second and Third Schedules.

 

 

Enacted by the Parliament of Lesotho.

 

Short title and commencement

 

 

1.         This Act may be cited as the Income Tax (Amendment) Act, 2014 and shall be considered to have come into operation on the 1st April, 2014.

 

Amendment of Second Schedule

 

 

2.          The Income Tax Act, 1993, (hereinafter  referred  to as "the Principal Act") is amended in the Second Schedule by deleting  "22%"  and "35%"  and substituting "20%"  and "30%", respectively.

 

Amendment of Third Schedule

 

 

3.          The Principal Act is amended in the Third Schedule by -

 

 

(a)        deleting items" 1" and "2" and substituting the following:

 

 

"1. Manufacturing Income 10%". (b)        renumbering item "3" as item "2".

NOTE

 

 

1.          Act No.9  of 1993

 

 

 

 

560

 

 

GOVERNMENT NOTICE NO. 39 OF 2014

 

 

The Parliament of Lesotho Statement of Objects and Reasons of the Income Tax (Amendment)  Bill, 2014

 

(Circulated by authority of the Honourable Minister of Finance

Leketekete Victor Ketso)

 

 

The object of this Bill is to adjust personal   income tax rates against the first and second thresholds   of chargeable   income.  Lesotho's   effective tax rate on personal income   has remained   one of the highest   in Sub-Saharan    Africa.   This has burdened   taxpayers   and even encouraged    tax avoidance    and probably   evasion   in some instances.   The adjustment   is therefore   intended   to reduce   the tax burden and encourage   tax compliance.   Furthermore,    the adjustment   of income tax rates will stimulate   consumption     emanating    from increased    incomes,    and as  such, Value Added  Tax will  increase.

 

The Bill again  abolish  the zero rate corporate  tax on extra-SACU   exports  and imposes   the  standard    10%  rate  to  all  manufacturers.     This  is  the  fulfilment    of Lesotho's    obligations    under  international    and  regional   agreements    to remove very  low tax rate  as a step  towards   regional   integration   and  to eliminate   unfair competition    that  could  arise  from  differentiated    tax  applicable   to other  domes- tic producers   exporting   within  SACU.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Printed  by the Government   Printer,  P.O. Box  268, Maseru   100 Lesotho