Own Correspondent
23rd September 2025
The Government of Botswana will amend the Value Added Tax Act to introduce the requirement of taxpayers registered for VAT to issue electronic invoices using Electronic Billing Systems.
The commencement date of the Amendment Act has not yet been announced and the public and all stakeholders will be informed when the new law comes into effect. E-Billing Regulations are being developed and will be shared with stakeholders when available to the public.
Electronic Billing involves the issuance of electronic invoices using a billing system that transmit sales information including VAT charged in real time to a BURS Electronic Billing Data Management system. The billing systems will be connected to the BURS billing data management system for managing and monitoring both sales and purchases transactions.
Jeanette C. Makgolo, Botswana Unified Revenue Service(BURS) Commissioner General, said “On executing our statutory role of advising the Ministry of Finance on Tax and Customs matters, we recommended for legislative amendments of the VAT Act, not only to support our revenue mobilisation initiatives, but also to bolster Botswana’s fiscal framework and economic resilience.”
She said, “the VAT Amendment Bill No. 22 of 2025 reflects the Government of Botswana’s proactive approach to modernizing our tax system in line with the dynamic nature of the global economy, particularly recognizing the rapid expansion of the digital landscape.”
A pivotal feature of this Bill is the extension of VAT to encompass digital or remote services supplied by non-resident providers to consumers within Botswana.
This ensures that Botswana’s tax system keeps pace with international standards while creating a fair competitive environment between local and foreign suppliers. To facilitate effective tax administration, a reverse charge mechanism has also been introduced.
Under this provision, registered persons, government entities, and large unregistered entities with annual turnovers exceeding P500,000 will be responsible for accounting for VAT on these remote supplies. This measure is intended to enhance compliance and safeguard our revenue base.
The amended legislation will mandate the compulsory use of certified electronic fiscal devices for all registered traders. These devices will serve to record sales transactions and issue fiscal invoices or receipts, fostering transparency, efficiency, and reducing opportunities for tax evasion.
Registered VAT businesses will have various options of E-Billing Systems to use depending on the size and nature of their business. Following are some examples of E-Billing Systems.
Itumeleng Kgosietsile, BURS Revenue Manager – Rulings and Directives said “VAT is a consumption tax – charged on the supply of goods and services. The current Act requires businesses to be in Botswana or partly in Botswana to register and collect VAT. It also requires fixed place of abode for registration and records to be kept in Botswana.”
She said, “It was based on traditional ways of doing business and was inadequate because it does not cater for remote services suppliers even though they carry on a taxable activity in Botswana.”
The VAT regulations were therefore being amended to widen the scope of VAT to enable taxation of modern forms of doing business and to equalise the playing field for domestic and remote service suppliers. It will also counter the challenges of collection from final consumers and the under-reporting of VAT sales by enabling real-time estimation of taxes owed by registered persons.
The VAT amendments accommodate the growth of digitalization – substantial amount of business conducted through online platforms. It is no longer necessary to have a physical presence to conduct business which has enhanced the ability to reach remote markets
Customs Controls are not designed to collect import VAT for services and intangible goods. Histrically there were no rules for taxing remote services by suppliers.
Introduction of place of supply rule for remote services suppliers who do not have places of business in Botswana, but who make supplies of such services to unregistered persons in Botswana.
It will include services physically performed in Botswana, Inbound tourism products (accommodation, transportation, tours, etc) and booking services related thereto, Telecommunication services and Remote services, digital and non-digital.
Now remote service suppliers do not need to have places of business in Botswana to collect and remit to the Revenue Service, VAT for services imported by a recipient resident in Botswana. Remote Service Suppliers are only required to charge and remit VAT when they deal with unregistered persons (B2C).
When dealing with registered persons, Government entities, and exempt bodies, there is a requirement for these recipients to do reverse charging of VAT. As these service suppliers have no place of business in Botswana, they account for VAT on “pay-only-basis’’, i.e. no input tax credits allowed.
The VAT Ammendment Bill proposes introduction of reverse charge by VAT registered persons. The current VAT Act requires reporting of VAT on imported services by recipients of imported services.
These recipients are Government entities, exempt persons and individuals. Government entities and large exempt persons will continue to account for VAT through reverse charging.
The responsibility for the reporting and making payment for remote services imported by individuals and other unregistered entities lies with overseas supplier, Government entity or a large unregistered person to register for purposes of accounting for reverse charged supply.
