International VAT Guides – Botswana

VAT rates in Botswana 

How much is VAT in Botswana? 

The Botswana VAT regulatory framework for digital service providers is established in a manner that follows the best practices according to the OECD standards for the digital economy. After a few years of dedicated work, Botswana VAT on digital services regime has put in place all pieces of legislation. 

Currently, the VAT regime for non-resident digital service providers is fully operational. The non-resident digital service providers have an opportunity to register for VAT and fulfill their tax duties through a simplified portal. 

Regulations concerning the implementation of the VAT on Remote Services framework were adopted on May 29, 2026. (VAT(Government Entities and Large Unregistered Persons) Regulations; and VAT(Remote Services) Regulations)

These regulations, which supplemented the VAT Act, have been the last piece of implementing legislation needed to ensure enforcement of the previously adopted Tax Amendment Act (October, 2025). 

VAT threshold in Botswana

The VAT Botswana Act, Tax Amendment Act(adopted in October 2025), and VAT Regulations on Remote Services, adopted in May 2026, are principal legislative instruments that coordinate the VAT compliance framework for non-resident digital service providers. 

The rules for VAT threshold in Botswana for non-resident digital services providers have been updated on several occasions, and the currently applicable rules indicate the following changes: 

VAT registration threshold for resident businesses: BWP 1,000,000 

VAT registration threshold for non-resident businesses: depends on the type of business activity

VAT registration threshold for foreign providers of digital services: BWP 500,000

VAT Taxable Activities in Botswana

Types of taxable activities that mandate VAT registration:

• Supply of goods and services for consideration;
• Supply of digital services by non-resident providers
• Exports;
• Imports of goods and services; 

Tax Representative in Botswana 

In light of the latest developments, non-resident providers of digital services have an option to register in a simplified manner through an online portal, and if they choose this registration path, contracting a local tax agent isn’t mandatory. 

Tax registration

Non-resident providers of digital services or intermediation platforms should, in most cases, register in Botswana’s VAT system following the route of simplified registration.

VAT on Electronically Supplied Services in Botswana 

Digital Services

Non-resident providers of remote services should register through the online portal from June 1, 2026. Government entities and Large Unregistered Persons(annual turnover of BWP 1,000,000) should register from August 1, 2026, for necessity to account for B2B transactions on the reverse charge basis. 

The simplified VAT registration framework is established through an online portal where the person can submit an application for a tax certificate, after previously registering a personal online business account, and with this registration becomes able to have full control over VAT management online. 

Non-resident providers of remote services should start collecting VAT for B2C supplies starting on October 1, 2026.

How much is VAT in Botswana for Electronically Supplied Services?

VAT rate in Botswana for digital services is 14%. 

Taxable Digital Services in Botswana

The following types of digital services are taxable:

• Audio and video streaming services 
• SaaS services
• Intermediation platform services
• Payment facilitation services
• Cloud computing services and storage

Marketplace and Digital Platform Operators’ Rules

The non-resident operator of a digital platform or marketplace has the same VAT compliance obligations as the direct supplier. When the operator facilitates the provision of remote services, supplied originally by the underlying provider, from the perspective of the VAT Act, it acts as a principal and becomes accountable for VAT on these B2C transactions. 

Invoicing Rules

A registered non-resident provider of remote services that makes a B2B transaction should issue a tax invoice for each B2B transaction and store the necessary information accordingly. 

For B2C transactions, issuance of an invoice or sales receipt with mandatory data is currently an available option for proper management of accounting documentation and records.

Foreign Currency Invoice in Botswana  

In most cases, issuing an invoice in a foreign currency is permitted. A simplified VAT return can also be submitted in foreign currency if the Commissioner General accepts the request previously submitted by the respective taxable person. 

Remittance can also be processed in a foreign currency. 

VAT Returns in Botswana

Simplified Return

Non-resident providers of digital services should register under the simplified vendor registration regime. 

A simplified VAT return doesn’t allow foreign providers of digital services to claim input tax credits. 

Simplified VAT Return

Penalties for late reporting and omitted declarations 

Penalties for VAT Non-Compliance:

Failure to register when required may result in penalties, including fines, interest charges on unpaid VAT, and other penalties. 

A registered supplier of remote services who, without reasonable cause, fails to maintain or retain records, shall be liable 

(a) for a failure that was made deliberately or recklessly, to a penalty equal to 75 percent of the amount of tax payable by the taxpayer for the tax period to which the failure relates; or (b) in any other case, to a penalty equal to 20 percent of the amount of tax payable by the taxpayer for the tax period to which the failure relates.

Registered supplier of remote services shall be liable to a fixed monetary penalty of BWP 10 000 for a company and BWP 5 000 for any other type of person, if no tax is payable by the taxpayer for the tax period to which the failure referred to above relates. 

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