The Namibia Revenue Agency (NamRA) has raised concern over extremely low tax compliance linked to the sale of shares or interests in companies holding mining and petroleum licences, revealing that only about 5% of such transactions have been reported for tax purposes over the past decade.
Speaking during a stakeholder engagement session at NamRA’s head office in Windhoek, Commissioner Sam Shivute said the agency’s records show that around 250 licence-related transactions have taken place in the past ten years, yet the majority were not declared for tax assessment.
“From the data that we are having now, we’re talking about maybe about 250 licences that have been traded over a period of about 10 years, and the compliance rate, as we are saying, is only 5%,” Shivute said.
The engagement session was aimed at improving understanding of tax obligations arising from the sale or transfer of shares in companies that hold mineral or petroleum licences. Such transactions may trigger tax liabilities under Namibia’s existing tax legislation.
Shivute noted that provisions allowing the taxation of gains from the disposal of mining interests were introduced in 2011, while similar rules for petroleum licence interests were implemented in 2015, bringing Namibia in line with international tax practice.
He said NamRA has recently strengthened its enforcement capacity through technical cooperation with institutions including the African Development Bank, the International Monetary Fund and the African Tax Administration Forum.
These partnerships have enhanced the agency’s ability to conduct specialised audits, particularly in complex areas such as transfer pricing and cross-border transactions.
According to Shivute, the improved capacity has already enabled NamRA to identify previously undisclosed transactions, including one deal valued at more than US$100 million.
“We have moved into a stage now where we are strengthening our compliance mechanisms. Because of this capacity, we are able to pick up transactions that were previously not visible, and tax has to be paid on that,” he said.
Shivute urged companies operating in the mining and petroleum sectors to prioritise voluntary compliance as the tax authority continues to strengthen its audit systems and transaction databases.
He also reminded taxpayers that Namibia’s tax amnesty programme, introduced in 2017, will expire on 31 October 2026.
“Voluntary compliance will help. People should make proper arrangements before the amnesty comes to an end,” Shivute said.
The commissioner added that NamRA maintains an expanding database of historical transactions involving licence transfers and share disposals dating back to 2011.
He noted that tax liabilities arising from such transactions do not prescribe, meaning the tax authority can still pursue outstanding taxes on past deals.
The stakeholder engagement brought together representatives from the mining, oil and gas industries, as well as accountants and tax specialists, to clarify reporting requirements and ensure businesses understand the tax implications of licence-related transactions.
