Botswana Unified Revenue Service: Milk No Longer Zero-Rated VAT

• Milk is no longer zero-rated for VAT under the revised Value Added Tax Act of 2026.
• The Botswana Unified Revenue Service (BURS) has removed milk from the list of zero-rated commodities.
• Businesses involved in the dairy industry will now have to pay VAT on their milk sales.
• Lawyers advising clients in Botswana's dairy sector should review compliance with the revised act.

The removal of milk from the zero-rated schedule has significant implications for businesses involved in the dairy industry, including farmers, processors, and retailers.

The Botswana Unified Revenue Service (BURS) has made a significant change to the Value Added Tax Act of 2026, removing milk from the list of zero-rated commodities. This means that milk is no longer exempt from Value Added Tax (VAT). The revised act brings about the most substantial realignment in indirect taxation in Botswana in recent years.

The removal of milk from the zero-rated schedule has significant implications for businesses involved in the dairy industry, including farmers, processors, and retailers. They will now have to pay VAT on their milk sales, which could impact their pricing strategies and profitability.

The Value Added Tax Act of 2026 is a key piece of legislation governing indirect taxation in Botswana, having commenced on July 1, 2026. The act sets out the rules for charging VAT on goods and services sold in the country, including the criteria for zero-rated commodities. Zero-rating allows certain essential items to be exempt from VAT, reducing the tax burden on consumers.

The revised act has been implemented by BURS, which is responsible for administering and enforcing tax laws in Botswana. The service has a range of powers to ensure compliance with the act, including the ability to issue penalties and fines for non-compliance.

The change to the Value Added Tax Act of 2026 has significant implications for businesses operating in Botswana's dairy industry. Lawyers advising clients in this sector should review their compliance with the revised act, particularly regarding milk sales and pricing strategies, to avoid potential penalties.

The removal of milk from the zero-rated schedule may also have broader implications for consumers, who could face higher prices for milk and dairy products as a result of the increased tax burden on businesses. The change highlights the need for businesses and individuals to stay up-to-date with changes in tax laws and regulations.

Lawyers advising clients in Botswana should review their compliance with the revised Value Added Tax Act, particularly regarding milk sales and pricing strategies, to avoid potential penalties.

Source: Original reporting via [Source]