Indirect tax - Botswana

• VAT is an indirect tax levied on the supply of taxable goods and services consumed within Botswana 
• VAT is levied on taxable supplies at the Standard rate of 14% for most goods and services and at the rate of zero percent on specified supplies.
• Zero-rated supplies include the following:
  • export of goods and services
  • international transport
  • sale of a business, making taxable supplies, as a going concern
  • petrol, diesel oil, illuminating paraffin, liquid petroleum gas
  • baby diapers,  sanitary pads or tampons and condoms
  • pesticides and fertilizers
  • basic food items such as brown bread, fresh vegetables and fruits (in natural state) rice (husked, milled, polished, glazed, parboiled or broken), samp (not further prepared/processed); cattle, sheep or goat milk not concentrated, condensed, evaporated, sweetened, flavored or cultured; bread flour (white, brown or whole wheat);  millet grain, millet meal, wheat grain, maize cobs, flour, sugar, setswana beans in their natural state and not mixed with other products; cooking oil; salt
  • tractors and agricultural implements
  • goods or services for the personal or official use of the President or any dependent
• Certain specified supplies are exempt from  VAT. These include:
  • residential accommodation
  • a supply of medical services
  • a supply of education services
  • a supply of financial services
  • exported goods and services

No.

In Botswana, Value Added Tax (VAT) is the principal indirect tax and it is levied on the supply of taxable goods and services by a registered vendor and on importation of taxable goods and services.

Yes.  VAT registration is mandatory where a person regularly or continuously makes taxable supplies, in Botswana or partly in Botswana, exceeding or expected to exceed P1 million in a period of 12 months and registration is voluntary where the value of taxable supplies exceeds P500 000 in a twelve-month period.

Yes.

No, however, a non-established person, as with all VAT vendors, is required to appoint a Botswana resident individual as public officer or a representative who is responsible for performing any duty, including the payment of tax, imposed on the non-established person under the Value Added Tax Act.  

A registered person is required to submit VAT returns on a monthly basis where annual taxable turnover exceeds BWP12 million or bi-monthly basis where annual taxable turnover is BWP12 million or less.

Yes. There are penalties for late submission of VAT returns at a rate of 10% of the tax payable for each month or part thereof that the return remains outstanding and P5 000 for a late ‘nil’ or refund return. Compound interest at the rate of 1.5% per month or part of a month is levied on late remittance of VAT.

Yes. Vendors making exempt supplies or who are not registered are required to declare and pay VAT on imported services within 30 days of importing the service. An importer is required to declare the goods for VAT purposes at the point of entry into Botswana.  

Yes. Penalties of up to 200% of the additional tax chargeable may be imposed for providing false or misleading information or statements or omission of information and Failure to register and account for VAT attracts penalties equivalent to 200% of the output tax that should have been levied in the period of non-compliance.

No. Only registered VAT vendors can claim input tax.   

• Input tax deduction is allowed where the VAT was incurred on supplies utilised or to be utilised in the making of taxable supplies. 
• Prohibited deductions include
  • VAT incurred on the supply or import of goods or services for use in providing entertainment except where the person is in the business of providing entertainment and the taxable supply or import relates to the provision of taxable supplies of entertainment in the ordinary course of that business; and
  • VAT incurred on the supply or import of a passenger motor vehicle with a seating capacity of nine or less, including a double cab vehicle. 

There is no specific provision to tax non-resident supplies electronic/digital services to private consumers. However, in the 2025/26 national budget the Minister proposed the introduction of VAT on digital trade.