ELSEWHERE in this issue we carry insightful comments on tax reform by former Basotho Enterprises Development Corporation (BEDCO) CEO Robert Likhang.
At the centre of Likhang’s presentation is that Lesotho’s punitive tax regime is causing the premature death of many SMMEs.
Many business people who spoke at the recent tax expo hosted by the Lesotho Revenue Authority (LRA) last week agree on the need to tweak Lesotho’s tax laws to ensure the survival of SMMEs.
Likhang’s argument resonates with the feelings of many entrepreneurs in Lesotho whose businesses are creaking under the weight of a heavy tax burden.
He suggests that the LRA eases the tax burden on small enterprises, borrowing from the Rwandan tax model.
Likhang suggests that SMMEs be allowed to make use of Value Added Tax for a certain period to grow their businesses, only remitting the VAT after a certain period.
That sounds pretty creative.
Such an arrangement could throw a massive lifeline to SMMEs that are grappling with severe cash-flow issues.
It would also allow the SMMEs to grow to allow long-term relationships with the revenue authority when they have matured.
The former BEDCO boss also suggested that SMMEs be allowed to pay their taxes only after they have been paid for services rendered to the government.
It is often a pity to see these small businesses collapsing, not because of ineptitude, but merely because the government would have failed to pay them on time so that they could clear their own debts and restock.
That is the reality that is facing many small businesses in Lesotho.
Yet the taxman would still expect his pound of flesh. He still expects you to remit your taxes on certain days with the threat of heavy penalties for those who fall foul of the law.
That environment is constricting business and leading to the collapse of many small enterprises. The closure of such businesses often has terrible ripple effects as hundreds are thrown onto the jobless heap.
The other negative is that when businesses are subjected to tremendous pressure they often seek dubious means to evade paying their taxes.
But most Basotho, we would like to believe, understand that it is their obligation to pay their fair share of tax. They are fully cognizant that such tax is critical for the development of their country.
They understand that taxation can be an effective tool for national development. It provides a stable flow of revenue that can be used for key development programmes such as infrastructure.
Yet the reality is that when tax rates are perceived to be high, there is often massive tax evasion and avoidance. The greatest challenge for the LRA, in our opinion, is to strike a healthy balance between a tax regime that is business friendly and one which can mobilise resources for economic development.
That is not any easy task. Push too hard, the LRA would be accused of aggressive tax collection. Slacken a bit, Lesotho’s development goals will suffer a massive knock. The LRA must therefore push for that balance.
Fight violent armed robberies
A spate of violent armed robberies in Maseru in the last three months has set the nation on edge. The sense of fear is palpable on the streets of Maseru.
The serenity which we had always enjoyed in Lesotho is now gone. In place of peace, there is now fear. We are living in fear and sleeping in fear.
With the police on the back-foot, Basotho are beginning to conclude that they are now virtually on their own.
These are indeed desperate times.
The government will need to explore much more robust policing methods and step up security across the capital if it is to restore the calm and tranquility that we have always known among our people.
What the recent armed robberies have also done is to expose the embarrassingly shambolic state of policing in Lesotho.
What the robberies have demonstrated is that the Lesotho Mounted Police Service (LMPS), which has been starved of financial and material resources for years, is clearly in no position to fight crime and win.
This is an institution that has a single vehicle for the whole of Maseru.
With a population of close to 400 000 people in Maseru, the dire lack of vehicles seems to have emboldened criminals who seem to know full well that the police’s reaction time will always be awful.
The government is surely aware of this dire lack of resources for the police. Sadly, nothing appears to have been done, for years, to address this pressing need.
Instead of ploughing resources in the LMPS so that we empower our police to fight crime, the government has often chosen to allocate such resources elsewhere.
Why on earth, for instance, does a government minister need three vehicles?
Such shocking profligacy is certainly unwarranted in a country like Lesotho where resources are often scarce.
The lack of financial and material resources has only compounded what is already an extremely dire situation in the LMPS.
This is a police service with a cocktail of its own problems that range from a demoralised staff that often fights for better pay to a police that appears still stuck in its old way of doing things when it comes to training and fighting crime.
A lot will therefore need to be done if the government is to jerk the LMPS and ensure it is fit for purpose. That task is urgent given the events of the last few months. The police must be prepared to fight fire with fire.
They must take the battle to the criminals. Gone are the days when Basotho would let their guard down thinking this is a peaceful society. We are living in extremely violent times when criminals have become more daring.
What this also shows is that we are in the throes of a major economic depression. Violent crime is likely to continue rising.
With no prospect of earning a living through legitimate means, desperate youths are likely to resort to deadly violence with absolutely no regard for the consequences.
The new government to be elected into power in October must convene an urgent national jobs summit to look at how to arrest these social ills. If we fail to come up with creative ways to generate new jobs, we are doomed. The anger amongst our young people will manifest itself in violent bursts of crime such as we have seen in the last three months.
The consequences are just too ghastly to contemplate.
Justice system in deep crisis
THE withdrawal of murder charges against former Prime Minister Thomas Thabane and his wife, ’Maesaiah, this week sends a wrong message about our justice system in Lesotho.
After failing to locate and bring to court four key witnesses who are said to be holed up in South Africa, the prosecution was left with no choice but to withdraw the charges against the Thabanes.
There are also fears that Thabane and his wife could eventually walk out as free individuals after the prosecution failed to bring them to court during a reasonable time.
By withdrawing the charges, the Director of Public Prosecution (DPP) office has opened itself to vicious criticism from ordinary Basotho who remain thoroughly unconvinced by the reasons it has put forward for the withdrawal.
The Lipolelo Thabane murder case remains huge in the eyes of the international press. The reasons are clear: this is a former Prime Minister and his young wife who are accused of a heinous crime.
With the eyes of the international community firmly fixed on Lesotho’s justice system, this trial was a chance for Lesotho to demonstrate its firm commitment to justice and the rule of law. But we have flunked that test.
What the withdrawal of the charges seems to tell us is that there is a set of laws for the rich and powerful and another set for the poor. Unfortunately, the ordinary man and woman on the street thinks the Thabanes have been allowed to get away with murder, literally.
The real victim of all these legal shenanigans are the late Lipolelo Thabane herself, her relatives and friends who have had to endure the pain of loss. As things stand, there is now a very small chance that justice will ever be served for Lipolelo.
That is sad.
But this decision also leaves a huge stain on the office of the DPP. Their explanation is that they could not trace the key witnesses in the case. That sounds odd.
We take this position based on the nature of the case and the precedents that have been set in the last four months or so. And given these precedents, the DPP’s explanation simply cannot fly.
A pattern is slowly emerging of a DPP that is extremely reluctant to charge and prosecute to finality powerful individuals in politics as well as in business circles.
The perception that has been created is that the machinery of justice is only meant to deal with the poor while allowing the rich and well-connected in society to get away easily even when the facts appear to be so clear.
The ordinary man and woman on the street thinks this was a deliberate bungling of what was otherwise a very solid case. Their anger is understandable.
The DPP’s office cannot blame anyone for this perception. They sowed this seed and must now reap the consequences.
Take for instance the recent cases in which powerful individuals have been acquitted in our courts. We can only think here of Tšeliso Nthane, a powerful businessman in Lesotho, and Thabo Moramotse, the son of Lehlohonolo
Moramotse, a powerful government minister.
The people have now concluded, rightly or wrongly, that some of these high profile cases are well-choreographed charades with no real intention to convict the accused. The arrests, trials and court appearances are merely meant to give an impression that some work has been done.
The people are right to make such conclusions. And the DPP must shoulder most of the blame for this crisis.
Reforms must succeed at all costs
THE failure by MPs to pass the Omnibus Bill of 2022 last week has thrown Lesotho into a legal limbo with a general election just less than 90 days away.
We are not surprised that SADC, together with the European Union (EU) and other development partners, are furious. They have every reason to feel that way. They see the failure to pass the reforms last week as a monumental failure on their part after they ploughed huge resources into the exercise over the last two years.
thepost understands that SADC is not amused at Lesotho’s failure to pass the reforms last week, with its anger now directed at a few individuals who they believe are out to sabotage the reforms.
On the basis of what happened last Wednesday, it is clear that there are elements within the political establishment in Lesotho who are out to deliberately throw spanners into the reforms. But they must not be allowed to succeed.
If they do, Lesotho which has gone through bouts of political instability over the past five decades, will likely suffer from the same set of challenges that have bedeviled the country. All the efforts that have been thrown into the reform agenda will also come to naught.
That prospect is just too ghastly for us to contemplate. By failing to pass the reforms, Lesotho risks attracting the wrath of SADC which has been extremely patient with us for years. Without SADC’s support, no government can survive in Lesotho.
The proposed amendments to the Constitution were likely to stabilise Lesotho politically while trimming the powers of the Prime Minister. It would also ensure that the army, which has been at the centre of the country’s troubled past, is reformed through the security sector reforms.
Issues that have troubled the judiciary as well as the media would also have been addressed. But instead of dealing with these issues and ensuring that the Bill is passed, our MPs dilly-dallied and fumbled along the way until they ran out of time last Wednesday.
Instead of addressing the matters raised by the people during the reforms process, our MPs appeared keen to tinker with the proposals for their own preservation. They wanted to sneak in certain clauses to secure their own political futures.
And so when the Bill went to the Senate, it was no surprise that the Upper House rejected it outright arguing it was not what the people had said they wanted. Their anger was pretty understandable.
Despite a mad rush to pass the Bill last Wednesday, parliament failed to do so at the last minute. Basotho had hoped that the October elections would be held under a new legal framework that would usher in a period of relative peace and prosperity.
So far, that appears very much unlikely. Our MPs must, therefore with all humility, accept a huge measure of responsibility for the mess. If the matter is not resolved, the MPs who served in the last parliament will be remembered as the generation of politicians who had a golden opportunity to drag Lesotho from squalor and squandered it.
As such they would forever be tainted by that spectacular failure to pass the reforms. The people should therefore never forget nor forgive this bunch of MPs.
These MPs would also be remembered as that generation of selfish politicians who were so fixated with their own political survival rather than the greater good of Basotho. How sad!
Deadlock over reforms
Moleleki’s security guards, car withdrawn
ABC at war over Thetsane candidate
Akani to appeal judgement
LEC switches off Prime Minister’s office
Minister dumps ABC, joins DC
RFP betrayed me, says businessman
The ‘post-partum blues’
Doti says goodbye!
Panic as syndicate terrorises Maseru
Fight violent armed robberies
Punching above their weight!
LAA wins another international award
In the best interest of development
Zambian influence in journalism
I made Matekane rich: Moleleki
Musician dumps ABC
MP dumps party, joins Matekane
South Africa won’t tolerate illegal immigrants
Row over army secrets
MP charged with stock-theft
End of the road for Letsatsi
Testy exchange in Mahao trial
Nthane acquitted of murder charges
Babolai ba Ha-Tsolo baa ahloloa
Metsing strikes ‘deal’ to return
Lesotho ease travelling restrictions
Mofomobe attacks RFP
A maize threshing machine
Thabane And Wife Go Scott-Free
Lesotho Soldier Dies In Mozambique
China-UNFPA Gift Lesotho With Sexual Health Commodities
TRC boss holds a presser
COMPOL Holomo Molibeli loses yet another court battle
MISA Lesotho blasts parliament
Molibeli licks the dust
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