By Phesheya Mkhonta
The Eswatini Revenue Services’ (ERS) Annual Tax Statistics Report for 2021/22 has revealed that the government agency has fallen short by 10% of its targeted revenue.
The report notes that ERS collected a total of E10.7867 billion in domestic tax revenue against a target of E12.022 billion, which was 10% below the targeted revenue. In total, however, ERS collected E17.093 billion when taking into account money collected from the Southern African Customs Union (SACU).
Worth noting is that Personal Income Tax (PIT) is Eswatini’s largest source of tax revenue. “Revenue collected from PIT was E3.795 billion in 2021/22, a 6.8% increase compared to 2020/21. PIT is Eswatini’s largest source of tax revenue and contributed 22.4% of the total tax revenue collected in 2021/21. As of 31 March 2022, 7 921 Individuals were registered under PIT.”
More specifically, as of 31 March 2022, Public Administration and Defense, Education, Human Health, and Social Work Activities sector had the highest amount of personal income taxes. This sector accounted for 49% of the PAYE in the 2021/22 financial year. ERS notes that the sector with the lowest amount assessed in the 2021/22 tax year was Real Estate activities, accounting for less than 1% of the PAYE.
Value Added Tax (VAT) is the second largest source of total tax revenue for the country. “Net VAT collections totaled E3.134 billion and increased by 7% compared to the previous year and 21% below target. VAT is Eswatini’s second-largest source of total tax revenue. In 2021/22 it accounted for 29% and 16% of domestic tax revenue and total tax revenue respectively. 41% of VAT payments are attributed to the Wholesale and Retail sector, and 26% from the manufacturing sector” notes ERS.
The third largest contributor to total tax revenue is Company Income Tax (CIT). Revenue collected from CIT was E1.84 billion in 2021/22, an increase of 28% from E1.44 billion in 2020/21. ERS observes that large businesses have the highest payments compared to Small and Medium Enterprises (SMEs). Large businesses contribute 75% of payments compared to SMEs.
Furthermore, revenue collected from fuel tax amounted to E1.289 billion compared to the previous year, the revenue collected increased by 2% and yet 17% below target.