LMC’s duty-free week gets boost
Mlusu has approved guidelines for Duty-Free Week, which runs from January 23 to 29, Nation on Sunday has learnt.
A government gazette dated January 14 2022 stipulates the Duty-Free Week under Customs and Excise Act.
Government has maintained the $3 000 (K2.5 million) goods value ceiling while limiting the cover to imports purchased within the seven-day period.
Read the regulations: “There is hereby declared a Duty-Free Week in the week beginning 23rd day of January, 2022 and ending 29th day of January, 2022, and hence the provisions of the Customs and Excise (Duty-Free Week) Regulations, 2022 shall, accordingly, be applicable.
“Where a Duty-Free Week has been declared, only the following goods shall qualify for suspension of duties under regulation 3—Goods whose customs value for duty purpose does not exceed $3 000; and (b) only those goods imported and entered for clearance during the duty-free week.”
The Duty-Free Week, a Tonse Alliance campaign promise prior to the 2020 Fresh Presidential Election, has been set aside to allow local businesses and individuals to import goods without paying any duties at the border.
The Malawi Revenue Authority said on its website that “this means that importers will not pay import duty, import excise and import value added tax. However, processing fees of K15 000 will be payable.”
Reacting to the gazetting of the Duty-Free Week, economist Milwad Tobias said declaring a duty free week when the country’s economy is suffering from foreign exchange shortages could be problematic.
He said: “I have not read of an economy in my life that makes a deliberate effort to promote imports. In any way, Duty -Free Week counters the Buy Malawi Strategy as an import substitution drive.
“You can externalise forex in that way which you also don’t have in the first place. In terms of policy consistency, Duty- Free Week is a flop and in terms of foreign exchange reserves, it flops.”
Meanwhile, Indigenous Business Association of Malawi president Mike Mlombwa while welcoming the Duty- Free Week, expressed worry over the conditions which restrict beneficiaries to those that purchase the goods within the week.
“The $3 000 limit is fine for a start but we would have loved if those that imported goods and would be shipped into the country within the stipulated week to also be considered. A week is short for some business people to travel abroad, find products and ship them in.
“That said, we believe that the initiative will help businesses to thrive as it comes at a time when economically the country is passing through some tough moments which can lead to business closures,” he said in an interview on Saturday.
Consumers Association of Malawi president John Kapito also backed the initiative as beneficial to local traders and consumers.
However, he feared that if not properly monitored, the initiative might up being infiltrated by unscrupulous businesspeople.
“My request to Malawians is that let us not abuse this opportunity by being agents of some established businesspeople who may hire you and give you the $3 000s to buy them goods. Let this help to improve your lives and businesses,” he appealed.
