MCCCI, ECAMA For tax review
Malawi Confederation of Chambers of Commerce and Industry (MCCCI) and Economics Association of Malawi (Ecama) have implored government to revise some tax anomalies, including value added tax (VAT) reforms in the forthcoming 2017/18 National Budget.
In his presentation during the first in a series of Prebudget Consultation Meetings in Blantyre last week, MCCCI chief executive officer Chancellor Kaferapanjira said there were anomalies in the VAT reforms where in some cases input VAT was introduced without corresponding output VAT.
He said: “VAT reforms started last year, introducing output VAT on a number of products that were exempt before and this was a positive development and helped in reducing and eliminating the need for VAT refunds.
“However, there were anomalies in some cases where input VAT was introduced without corresponding output VAT such as in the printing sector which created problems that were supposed to be resolved.”
Kaferapangira also proposed that government should review tax measures in the telecommunications, real estate insurance and agriculture sectors.
He also proposed the removal of three percent withholding tax on farm produce in the agriculture sector to boost the sector.
Said Kaferapanjira: “Surveillance Network Cameras [CCTV] and Network Video Recorders attract 16.5 percent surtax, 25 percent customs duty and 30 percent excise yet these are related to network devices and computing items which do not attract duty or surtax. We would want to see government removing 10 percent excise tax on text messages and data.”
On his part, Ecama president Henry Kachaje said better VAT administration and management is crucial for the business community as this will filter in economic growth.
He said government also needs to speed up VAT refunds, observing that “currently the VAT claim arrears [are estimated] at about K15.5 billion which is a big cash flow squeeze for private sector operators”.
In Lilongwe, the Malawi Economic Justice Network (Mejn) has asked government to prioritise measures of enhancing demographic dividends in the 2017/18 fiscal year budget to enhance economic growth.
Mejn executive director Dalitso Kubalasa made the call in Lilongwe on Thursday during the 2017/18 Pre-budget Consultations Meeting.
He said: “We should go back to reflect on the investment made on the productive workforce which is the potential asset growth. We need to optimise and maximise human capital development that will spur development.”
Minister of Finance, Economic Planning and Development Goodall Gondwe said education alongside measures of counteracting climate change will be top priorities in the third phase of the Malawi Growth and Development Strategy (MGDSIII) currently being reviewed at Cabinet level. n
