MRA targets K492 billion for 2014/15 Budget

Malawi Revenue Authority (MRA) has set a whopping K492 billion tax collection target for 2014/15 fiscal year as taxpayers bear the brunt of the donor budgetary support freeze.

The 2014/15 fiscal year target is a rise from the 2013/14 target of K345.11 billion and the actual collection of K394.10 billion and comes as majority of Western donors, who contribute 40 percent of the country’s domestic budget, continue withholding budgetary support following the Cashgate.

Presenting a paper on revenue performance for 2013/14 and expectations for 2014/15 to the parliamentary Budget and Finance Committee in Lilongwe, MRA deputy commissioner general Roza Mbilizi said the target is attainable if certain assumptions are realised including a six percent projected growth in Gross domestic growth (GDP).

“We also anticipate the import of 11.8 percent to benefit import duty and exercise, stability in the kwacha exchange rate but one that is reflective of fundamentals. We will increase company taxes as we expect a good economic performance and companies will continue to be profitable. We also expect continued availability of forex,” said Mbilizi.

She further said MRA was optimistic about meeting the target as it expects to make further efficiency gains to improve on its revenue collection following the roll out of the Electronic Fiscal Devices (EFD), operationalisation of cargo scanners and other MRA reforms.

“We have also enhanced close monitoring of debt management by stations with emphasis on big debts to ensure we produce quality audits and raise quality assessments and collect associated debts while escalating measures in the collection process,” said Mbilizi.

Budget and Finance Committee chairperson Rhino Chiphiko said the committee would continue engaging the revenue authority, but said the committee was impressed with several reforms at the MRA.

“We will interface to learn more on the technical aspect of how MRA works so that as a new committee we can give a more informed input on their work. However, we are grateful as MRA was the first stakeholder to appear before our new committee, but gave a very robust and elaborate presentation which has impressed the members,” said Chiphiko.

Revenue collection has improved drastically since 2012/13 fiscal year, but the absence of the donors’ budget support hasnecessitated the hiking of taxes.

Donors are demanding reforms and restoration of confidence in the public finance management system after over K13 billion was stolen from government coffers in the Cashgate.