The Malawi Revenue Authority (MRA) says it is on track to meet its K6.2 trillion revenue collection target this fiscal year, citing positive response from rental income tax initiative.
MRA head of corporate affairs Wilma Chalulu said in an e-mail response yesterday that the agency has completed its door-to-door property information verification exercise in selected low density areas of Lilongwe and Blantyre.
The exercise, conducted between April and May, gathered details such as plot number, property type, year of construction, density classification, number of rental units on the property, occupancy status and average monthly rent per unit, among others.
Chalulu said the effort has helped identify previously unregistered landlords and improve taxpayer compliance.
“MRA expects rental tax revenue to increase significantly as a result of identifying previously unregistered landlords, improving taxpayer compliance and broadening the tax base,” she said.
While declining to provide specific figures, she noted that the initiative would contribute “substantially” to domestic revenue mobilisation.
Chalulu said the agency has already begun implementing the tax, reminding qualifying landlords that payments are due by July 20.
The property verification drive comes as the government seeks to boost collections by more than 40 percent compared with last financial year’s K4.3 trillion target.
Meanwhile, MRA Commissioner General Felix Tambulasi said the authority is optimistic of surpassing the target and has collected K532 billion in the first month of the fiscal year, exceeding its target by K22 billion.
“We are hopeful that come year end, we will not only reach the target but also surpass it,” he said.
In 2026/27 National Budget Statement presented in Parliament on February 27 this year, Minister of Finance Economic Planning and Decentralisation Joseph Mwanamvekha directed MRA to immediately enforce the collection of rental income tax on residential property, including a comprehensive registration exercise of landlords.
He said: “Government has observed that many residential property owners, particularly in the cities of Mzuzu, Lilongwe, Zomba and Blantyre, collect significant rental income without paying taxes.
“However, due to implementation challenges, residential property owners have not been remitting the tax to MRA while most commercial property owners have been complying.”
Mwanamvekha said to ensure compliance, he directed Electricity Supply Corporation of Malawi, water boards, Malawi Housing Corporation, city councils and the Ministry of Lands to cooperate with the MRA to provide necessary information pertaining to the owners of residential properties in low density areas.
In an earlier interview, Economics Association of Malawi president Bertha Bangara-Chikadza said the tax reforms are necessary, but carry macroeconomic risks.
He warned that higher taxes could push small businesses into informality, undermining financial inclusion and narrowing the tax base.
Residential rental income below K2 million annually is exempt, while income above that threshold is subject to a 15 percent withholding tax, according to MRA.
