Malawi Revenue Authority (MRA) says the electronic invoicing system (EIS) in the collection of value-added tax (VAT) is here to stay with 7 500 out of 9 000 VAT-registered businesses compliant to date.
MRA Commissioner General Felix Tambulasi told the media at Msonkho House in Blantyre yesterday that the compliance rate was an indication that the system, touted to improve efficiency in VAT collection, was feasible and presented operational benefits to businesses.
“We will be providing free technical support to taxpayers who may still require assistance during this period. However, VAT operators will not be allowed to use EFDs [electronic fiscal devices],” he said.
Tambulasi’s sentiments come on the back of protests by some traders who have since the roll-out of the EIS on May 1 2026 shut down their businesses and plan to hold nationwide shutdown today.
During the press briefing he queried the basis of the resistance from some traders, stressing that VAT, currently levied at 17.5 percent, is a consumption tax borne by consumers while businesses merely act as collection agents on behalf of MRA.
“It is unfortunate that some traders have chosen to close their shops in protest against the implementation of EIS. It is even more concerning that some are reportedly threatening fellow traders who wish to continue operating,” said Tambulasi.
Chipping in, MRA director of legal services Beatrice Mwangwela warned that non-compliance carries significant penalties, including fines ranging from a minimum of K5 million for businesses operating outside the system.
From Friday, business activity has largely stalled in key commercial hubs such as Limbe, Blantyre, Lilongwe, Mzuzu, Zomba, Mangochi, Luchenza and Kasungu with some traders protesting the shift from EFD, a hardware-based system relying on fiscal printers and electronic cash registers to EIS—a digital platform that enables real-time transmission of invoices directly to MRA.
MRA argues that the transition is critical for improving tax compliance, enhancing transparency and sealing revenue leakages.
On the other hand, the business community contends that the enforcement has been abrupt, leaving many small and medium enterprises (SMEs) struggling to register, acquire compatible devices and fully understand the system.
But Tambulasi yesterday said the public tax collector had exhausted all preparatory measures, including sensitisation campaigns and extension of the transition period to ensure that businesses migrate from EFD.
Initially, the EIS was set for roll- out on November 1 2025 but was postponed to February 1 2026 and later May 1 following protests from some traders.
Meanwhile, the traders have called off nationwide demonstrations which were scheduled today under what they described as a “national shutdown and protest.”
In an interview last night, Small Scale Business Importers and Exporters Association of Malawi chairperson Robert Nachamba confirmed the cancellation.
He said: “We had a meeting following what MRA has told Malawians through their press briefing today and both parties agreed to hold a meeting tomorrow [today] to negotiate again with MRA.”
Consumers Association of Malawi executive director John Kapito, in an interview yesterday, urged traders to comply, noting that policy reversals on such reforms are unlikely in the short term.
“It is not surprising to see resistance. With every innovation, there are always those who are slow to adapt,” he said.
In an earlier interview with The Nation, EK Tax Consulting senior tax consultant Emmanuel Kaluluma said the concerns were largely unfounded, arguing that the system is designed to improve accuracy in tax administration rather than impose additional burdens.
The EIS roll-out is part of broader fiscal reforms outlined in the 2026/27 National Budget, presented by Minister of Finance, Economic Planning and Decentralisation Joseph Mwanamvekha, which also raised the VAT registration threshold from K25 million to K50 million to ease compliance for smaller businesses.
