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Botswana temporary VAT cut ends 1 April 2023 – 14% rate returns

Ending of prolonged temporary VAT rate cut from 14% to 12%

Botswana’s Unified Revenue Service has confirmed that the standard Value Added Tax rate has reset to 14% on 1 April 2023. This follows a nine-month reduction following inflation concerns.

Jan 2023 Extension of temporary inflation VAT cut from 14% to 12% until 31 March 2023

Botswana is to extend its temporary cut of VAT from 14% to 12% until 31 March 2023. It was initially dropped on 1 August 2022 and was due to revert at the start of February.

Botswana raised VAT to 14% in April 2021.  The measure was to shore up revenues following the COVID-19 crisis which has affected its tourism and mining sectors. As of end of 2021, Botswana had recovered to its pre-crisis output level thanks to a strong rebound in demand for diamonds, a successful vaccination campaign, and policy support

Since then, post-COVID global supply chain and the Russian invasion of Ukraine has pushed inflation to nearly 13%. This is mainly caused by transport costs.

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