Minister Serame announces P1.8 billion relief

Government has announced P1.8 billion short-term interventions in an effort to cushion households from the prevailing economic stress.

Briefing Parliament yesterday, Minister of Finance, Ms Peggy Serame said effective August 1, Value Added Tax (VAT) would be reduced by two per cent from 14 to 12 per cent for six months.

The house heard that cooking oil and liquid petroleum gas would be zero-rated for VAT purposes for the same period.
Ms Serame called on retailers to adjust their prices to align them with the new developments.

“I expect retailers and other traders to reduce their prices accordingly and ensure that the benefits of these measures are passed on to the intended beneficiaries, and that is the households,” she said.

Additionally, Ms Serame said local student tertiary institution allowance would be increased by 18.5 per cent effective September while unspecified adjustments would also be made for externally placed students in selected countries to align them with the cost of living there.

The minister said government had decided to provide additional loan funding to Botswana Meat Commission (BMC) in an endeavour to address delayed payment of cattle suppliers.

“Government will also provide additional loan funding to BMC from the Public Debt Service Fund up to a maximum of P120 million. This loan will be used for, amongst others, enabling BMC to catch up on payments to suppliers and to provide additional working capital.

The disbursement of these funds to BMC will be subject to firm commitment by the commission to fulfil certain conditions.

These include the commencement of the BMC Transition Act which provides the foundation for the permanent removal of the BMC’s beef export monopoly and for bringing in a private sector partner through partial privatisation,” she said.
Noting that the interventions would result in an increased national deficit due to reduced revenues and additional expenditures, Ms Serame said government would continue to monitor the situation and act accordingly whenever the need arose.

“I wish to assure the nation and this house that government will continue to monitor the situation with a view to undertaking any remedial measures as and when required. The impact of these interventions will be formally reviewed within six months,” she said.