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MBABANE – Since its inception in 2020, the Revenue Appeals Tribunal Eswatini (RATE) has received 15 appeal cases and nine of those were Income Tax appeal cases.

According to the RATE case summary reports, nine cases were Income Tax appeals, while four were of Value Added Tax (VAT) and two were Customs appeals. Worth noting is that, RATE was established under Section 3 of The Revenue Appeals Tribunal Act, 2019 and mandated to hear and determine appeals arising from decisions of the commissioner general of the Eswatini Revenue Service (ERS). The tribunal is a special semi judicial body consisting of a panel of experts, who are officially appointed by government but act independently to ease the backlog of revenue cases by resolving them outside the hierarchy of the regular court system.


The first case was an Income tax – Gross Income – 2016-2019 Pay As you Earn (PAYE) audit assessment- Benefits in kind. In this case, the appellant (a prominent school) offers its employees a children’s educational assistance program in which the school fees of children of employees of the school are calculated using marginal cost to the employer, which is a lesser amount of school fees than that of non- employee parents whose children are enrolled at the school. The appellant (school) disputes the valuation of the benefit by the Respondent. It is worth noting that this case was concluded to the effect that ruled in favour of the school in that Eswatini Revenue Service (ERS) erred in the taxation of such benefits to their teachers. 

In a ruling, the tribunal granted that ERS erred in law in finding that the children’s educational assistance benefit afforded by the school to its employees was taxable and had been under-declared by the school. It directed the ERS to determine the educational assistance benefit at cost to the employer for educating an additional child of the employee. The second case was an Income tax – Gross Income – 2018-2020 allowable tax deductions. The appellant is a sole trader with property and rental income businesses an also has a stationery company; however the audit was conducted on his personal capacity as a sole trader. The basis of the appeal advanced by the appellant is the dissatisfaction on the treatment of what he considered allowable tax deductions in the course of generating his income.  The appellant made a clear list of these deductions in an objection raised with ERS, following an initial decision to disallow these expenses during an Audit. Case number three is on infrastructural Initial Allowance – Wear and tear allowance – disallowed allowances– for year ended March 2022.  


The appellant claimed initial infrastructural and wear tear allowances for its transmission and distribution lines as allowable deductions from the computation of its gross income for the year ended March 2022.  In respect to initial infrastructural allowance the appellant argues that due to the nature of its business which requires transmission and distribution lines to be installed at varying intervals of the year and are spread all over the country, a unique and more feasible approach should be adopted for it, where the ERS verifies the assets on which initial allowances are claimed after the installation.  ERS denied allowances for both initial infrastructural allowance and wear and tear allowance sought by ERS in the tax year ended March 2022.

In another case, which is a tax issue; waiver and abatement of penalty. The appellant made an error in the calculation of its employees P.A.Y.E Tax, by calculating the tax based on the employees’ net pay as opposed to the employees’ gross earnings.  This resulted in an understatement of the P.A.Y.E Tax due to the ERS. Upon realising the error, the appellant reached out to the respondent to alert them about the error and made the shortfall payment. ERS acknowledged the payment but returned to the appellant with a revised account summary in which it had imposed both a penalty and a interest charge in accordance with order.  The appellant held the view that to impose the maximum penalty available was a harsh response by the ERS and therefore sought a waiver.

Another case is a tax issue – Customs- Import – Import VAT Payable – Valuation of Motor Vehicle – unfair administrative action. The ERS impounded the appellant’s vehicle with registration TSV 520 GP on the basis that import duties were not paid whereas it was considered to have been imported. Appellant seeks to recover the motor vehicle.  Another customs case was the classification- of Import Item –VAT classification. The Appellant’s case emanated from an interim audit report dated August 2020 which indicated that a customs post clearance audit was conducted on the declarations made by the Appellant.  The interim audit report uncovered that the Appellant had 29 import declarations of mixed fowl feed which is classified under tariff code 2309.90 which were incorrectly zero rated by using APC 108 (an additional procedure code) which is used when submitting a declaration of zero-rated animal feed. Another case was on time limits for filing of an objection – Section 52 (1) Income Tax Order.


In this case, the appellant received a Tax Assessment, wrote a letter to the ERS requesting that it considers an objection to the assessment citing reasons that its original accountant fell ill, followed by the subsequent accountants being appointed failing to assist.  Finally, a professional service provider (Cardo Capital) was enlisted to assist, and they advised that Appellant ought to have filed an objection because it had all relevant documents to lodge on objection. It is worth noting that last week, members of the tribunal were re-appointed and sworn in. They were given yet another three years in office by the Minister of Finance Neal Rijkenberg exercising his powers conferred by section 3 (2) of the Revenue Appeal Tribunal Act No. 13 of 2019.  The re-appointment of the members would allow them to continue resolving some of the cases that were not resolved by the end of their first term in office. Speaking during the searing in ceremony, RATE CEO Nelsiwe Hlophe said she believed that members would continue to perfectly contribute to the tribunal with their vast professional experience. “Members are expected to continue with their mandate of adjudicating the tax appeal cases, which most of them have hearing dates to avoid backlog of cases,” she said.