THE Financial Intelligence Centre (FIC) has detected over 90 cases of potential tax evasion, which, if quantified, represent a potential loss in state revenue of more than N$1,67 billion in just three months.
The above was revealed by the centre in the second quarter report (July to September 2019), and in the monthly reports for October and November 2019. The November report was released last month.
These reports are issued to communicate relevant statistics on the operations of Namibia's national 'Anti-Money Laundering, Combating the Financing of Terrorism and Proliferation Framework'. The reports also contain statistics on the mandatory reports received from various stakeholders in terms of the Financial Intelligence Act.
In the second quarterly report, the FIC said there were 29 cases of citizens and/or companies that had not paid tax by engaging in illegal means to evade their tax obligations. This number was the same as for the first quarter (April-June 2019).
The centre has been disclosing such detected cases to the finance ministry for some time. However the taxman seems to be hesitant to act, as records still show that tax evasion remains the leading potential offence in all the reports published to date.
The potential loss through tax evasion in the second quarter was N$1,67 billion.
For October alone, the FIC detected 29 potential cases of the illegal avoidance of tax and an additional four were recorded in November.
Despite these potential tax evasion cases and the continued erosion of the tax base, FIC has confirmed about 196 disclosures (in eight months) were referred to law enforcement agencies for appropriate intervention, the centre said.
The ministry of finance received around 99 disclosures - the majority of disclosures for the eight months.
FIC is Namibia's financial intelligence unit and is empowered to, among others, collect, request, receive and analyse reports relating to money laundering, terrorist financing and proliferation financing. It is also tasked with sharing actionable intelligence obtained from such activities with identified stakeholders, as per the financial intelligence law.
These reports are part of a database which assist financial crime combatting efforts within local and international law enforcement agencies.
The tax lost, if collected, could make a sizable dent in treasury's N$10 billion budget deficit.
FIC indicated that it will increase its existing efforts to further outline to competent authorities nationally.
During the mid-term budget review last year, finance minister Calle Schlettwein said the government's revenue collection was projected to be N$55,9 billion, 1,4% short of target.
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