GABORONE, Botswana: The African Tax Administration Forum has sent two senior tax specialists to Botswana to help the Botswana Unified Revenue Service develop a framework for taxing high net worth individuals.
Paul Khanare and Ronald Waiswa are conducting a five day technical assistance mission with BURS from 17 to 21 August 2026.
The mission will assist Botswana in designing the legal, administrative and data systems needed to identify wealthy taxpayers, assess their income and assets, and improve voluntary compliance.
The assignment will cover the definition of a high net worth individual, rules for identifying potential taxpayers, institutional structures, data access and engagement with relevant stakeholders.
It is expected to conclude with a presentation to senior officials on the proposed taxation framework and the next steps for implementation.
Khanare and Waiswa are co authors of ATAF’s Guide to Implementing an Effective High Net Worth Individual Taxation Regime in Africa.
The guide was based on research in nine African countries, including Eswatini, Kenya, South Africa, Tanzania, Uganda, Algeria, Togo, Zambia and Zimbabwe.
ATAF said the work was prompted by the limited contribution of personal income tax across much of Africa.
Only about five per cent of employed adults on the continent pay personal income tax, compared with approximately half of the employed population in high income countries.
More than 90 per cent of personal income tax collected in Africa comes from formally employed people through Pay As You Earn systems.
This leaves significant sources of wealth and income, including capital gains, investments, rental property and business ownership, outside the tax net.
The guide says African tax administrations face several obstacles when trying to identify wealthy taxpayers.
These include fragmented and manual taxpayer records, limited access to banking information, high levels of informal economic activity and currency instability, which can make fixed financial thresholds unsuitable.
Identifying high net worth individuals
ATAF recommends that countries avoid relying on a single net worth figure to determine who qualifies as a high net worth individual.
Instead, it proposes a system using several indicators, including income, ownership, business activity, investments and lifestyle.
Potential core indicators include control or beneficial ownership of large companies, high annual income or business turnover, ownership of several or high value properties, substantial banking and investment activity, ownership of yachts or aircraft, and large scale commercial farming.
Significant wealth in sectors such as mining, telecommunications and gaming could also be considered.
Other indicators may include large import and export activity, government supplier status, ownership of luxury vehicles, public influence and high private expenditure such as overseas school fees or exclusive club memberships.
For countries where cryptocurrency holdings are significant, ATAF recommends treating crypto assets as a priority indicator.
The guide proposes a threshold of at least US$50,000 in crypto holdings or annual crypto transactions of at least US$250,000.
The thresholds used in Uganda and Kenya are cited as examples, although ATAF says each country should develop criteria suited to its own economy.
Uganda considers factors including ownership in large taxpayer companies, annual rental income above US$142,858, bank transactions exceeding US$1 million a year and loans above US$1.5 million over five years.
Kenya uses indicators such as gross annual income of at least US$769,000, annual rental income of US$385,000 and a net asset base of at least US$3.8 million.
ATAF’s proposed continental definition describes a high net worth individual as:
“A High-Net-Worth Individual in Africa is any person who, either directly or through related parties, exhibits one or more significant indicators of wealth, income, or asset ownership that place them within the top segment of the national income and wealth distribution, as determined by measurable indicators and established thresholds determined by each country.”
Once potential taxpayers have been identified, the guide recommends a Know Your Client process to verify information, remove people who do not meet the required criteria and update records with undeclared income sources.
Dedicated tax units
ATAF recommends that tax administrations establish specialised high net worth individual units.
Kenya, South Africa, Uganda, Australia, Tanzania, Togo and Zambia already have similar structures.
Kenya calls its unit the Premier Tax Office, Uganda uses the HNWI and VIP Unit, South Africa refers to its High Wealth Individuals unit and Zambia has a High Income and Prominent Individuals unit.
The guide says the name of the unit matters because language that appears punitive may create resistance among taxpayers and political leaders.
The recommended unit would oversee taxpayer relationship management, compliance, audits, investigations, debt enforcement and data analysis.
ATAF recommends that the unit be led by a senior official reporting directly to the Commissioner for Domestic Taxes.
The guide cites staffing ratios of one tax official for every 17 wealthy taxpayers in the United Kingdom, one for every 59 in South Africa and one for every 33 in Kenya.
Data access
The guide identifies access to reliable information as one of the biggest challenges facing African tax administrations.
Although many revenue authorities have legal powers to request information from banks, land registries, company registries and other public agencies, those powers are not always used systematically.
Banks sometimes rely on secrecy laws when responding to broad information requests. Data protection laws have also become a barrier in some jurisdictions when agencies seek information for tax enforcement.
The guide notes that Eswatini’s data protection framework contains specific exceptions for tax enforcement.
However, it says other institutions may still refer to data protection rules when declining to provide information.
ATAF recommends that tax administrations seek access to company and beneficial ownership registers, property records, vehicle registers, government procurement and payment data, bank transaction information, central bank investment data and stock exchange records.
Income and wealth
The guide says tax laws should cover employment income, fringe benefits, stock based compensation, investments, capital gains, rental income, intellectual property royalties, professional fees, cryptocurrency gains, gifts and transfers of wealth.
It also says income from illegal activities should be taxable, noting that countries such as the United States, United Kingdom, Germany, Kenya and South Africa apply this principle.
ATAF does not recommend wealth taxes as the main tool for improving revenue collection.
It says stronger income tax rules and better use of third party information are likely to be more effective.
The guide notes that annual wealth taxes remain uncommon globally. Switzerland, Spain and Norway are among the few OECD countries that maintain such taxes.
In Africa, Algeria has operated a broad wealth tax since 1993, while Zimbabwe introduced a narrower tax on high value residential properties in 2024.
Political challenges
ATAF also points to political interference as a major challenge in enforcing tax obligations among wealthy individuals.
The guide says wealthy people in many African countries are connected to political establishments or are part of them.
Research in the nine participating countries found instances where laws restricted the sharing of information with revenue authorities.
Tax officials have also faced intimidation when pursuing cases involving politically connected individuals.
The guide refers to selective enforcement as another concern, where political allies are protected while opponents face audits.
ATAF recommends presenting high net worth taxation as a fairness measure rather than introducing it as a new tax.
It also calls for careful communication, engagement with political leadership, strong administrative independence and a balance between enforcement and improved taxpayer services.
The Forum said it had assisted nearly 10 African tax administrations with high net worth individual taxation and that requests for technical support were increasing.
The Botswana mission forms part of ATAF’s broader work to strengthen domestic resource mobilisation and promote a fairer distribution of tax responsibilities across Africa.
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