Payroll glitch forces politicians to repay back-pay taxes

LEGISLATORS are expected to reimburse government close to E2 million following a system-related error which resulted in statutory tax deductions not being effected on the applicable back-pay amounts in their December salaries.

Each Member of Parliament and senator is expected to pay back E20 758.27.

The Treasury Department has already written letters of request to all members of the House of Assembly and the Senate asking them to reimburse the untaxed back-pay related to their allowances.

Government is expected to receive more than E1.7 million from the reimbursement by legislators alone.

However, according to sources, all politicians, including members of emabandla and Cabinet ministers, are also expected to reimburse government depending on the allowances that they received because a similar glitch also happened to them.

When politicians received their back-pay from the salary review in December 2025, the Treasury Department stated that the funds were deposited without the deduction of allowance tax, which amounts to E20 758.27.

Legislators, under their new salary scale, earn E83 984 monthly, which equates to E1 007 803 annually. This amount includes their basic salary and allowances.

Most legislators were served with letters of request last week during their sittings in both the House of Assembly and the Senate.

The letters, signed by Nomsa Simelane, requested them to pay back the outstanding tax amount over a maximum period of four months, from March to June, in instalments of E5 189.57 per month.

In a letter seen by this newspaper dated February 24, the accountant general requested the legislators to reimburse government the untaxed back-pay related to allowances.

Simelane said during the reconciliation process, it came to the department’s attention that while processing back-pay allowances for legislators in December, a system-related error resulted in statutory tax deductions not being effected on the applicable back-pay amounts, contrary to the Income Tax Order of 1975 Section 7(b).

Section 7(b) extends the meaning of gross income to include any voluntary funds received in respect of services rendered or to be rendered, which permits the taxation of allowances.

Simelane stated that a subsequent review of records indicated an outstanding tax liability arising from back-pay on household allowances amounting to E7 400.48, back-pay on housing allowances amounting to E24 668.16, and back-pay on constituency allowances amounting to E30 835.20.

The total that was paid by government in allowances for the legislatures is E62 903.84 and the 33% tax reimbursement that the legislators have to pay is E20 758.27.

“To ensure this matter is managed with minimal inconvenience, it is proposed that the outstanding tax amount be recovered over a maximum period of four months, from March to June 2026,” said the accountant general in the letter.

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Simelane stated that this arrangement was intended to avoid the application of a full deduction at source (FDS) as a lump sum in July, as well as interest charges.

She requested legislators to complete and sign a debt acknowledgement form attached to the letter and submit it to the financial controller in their department.

She added that if the completed form was not received by the stipulated date of March 3, it would be assumed that the member had made arrangements with the Eswatini Revenue Service (ERS) on how the liability would be settled.

This was despite MPs receiving their letters on March 2, while senators received theirs on March 6.

One MP who spoke on condition of anonymity said they were shocked by the situation, particularly because they were informed about the anomaly two months after they had received the money.

He also stated that some parts of the letter appeared threatening as those who did not agree to the deductions would be required to pay the full amount even though the error was not their fault.

“We have been told to sign the debt acknowledgement form which will serve as an agreement that E5 189.57 will be deducted from our salaries monthly. Mind you, we were not aware of this debt but we are now expected to have deductions from our salaries,” said one legislator.

Another MP said they were also shocked when they were served with the letters during a sitting. He said they had initially thought that when Jabulani Mabuza announced that they would receive individual letters from the accounts office, it was not related to a debt.

The MP said they had no choice but to pay back the money as they had to set an example.

“Many things happened when the calculations for the new salary review grades were done at the Treasury Department. Some people were paid more while others were paid less,” said the legislator.

Meanwhile, one senator also confirmed that they received their letters last Thursday. He said all of them were served with letters from the Treasury Department, except those who were absent.

He said it appeared that all legislators had received similar letters since they were expected to reimburse the same amount.

“We went there thinking it was good news only to realise that government wanted E20 000 from us, which was not deducted as tax back in December. All of us are supposed to pay back the money,” said one of the senators.

Madala Mhlanga said he had noticed the anomaly in December and contacted the Treasury Department about the matter.

He said the department informed him that they would consult with the ministry of public service, which later indicated that the issue would be resolved either through deductions in July or through instalments.

“They said they would fix it. This is tax and legislators have an obligation to pay it back. I personally noticed that something was wrong when we received the money and asked that they address it. I have not yet received my letter because I have just returned to the country, but I did notice the anomaly when the money was deposited into our accounts,” he said.

Benedict Xaba confirmed that Parliament received correspondence from the Treasury informing them about the anomaly.

He said the department indicated that there were funds from which tax deductions had not been effected from legislators’ salaries and that this now had to be corrected.

He said the situation was unfortunate because legislators had already received the money and it was not their fault. He apologised on behalf of the Treasury for the oversight.

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“Now that we have noticed that the mistake has occurred, it has to be corrected because at the end of the year this may appear as a query which could affect the MPs. The request by the Treasury Department will be implemented, but we apologise to the legislators because they were not at fault on this issue,” he said.

Xaba added that Parliament had not yet started processing salaries, which would be done this week, meaning there was still time to correct the anomaly.

He said legislators had no option but to pay back the money. He said the deductions would still be effected even though the error was not the fault of the legislators, as they were also not informed about the anomaly in time.

“According to the Treasury Department, all politicians were affected. When the review was implemented, the review for politicians was delayed and it was not included as part of the one for civil servants. I am not sure about tinkhundla councils, but all legislators were affected,” he said.