MRA upbeat on revenue target
Malawi Revenue Authority (MRA) says despite prevailing economic challenges, the public tax collector is optimistic of meeting its targeted revenue in the 2023/24 financial year.
MRA head of corporate Affairs Steven Kapoloma said this during the opening of the 2023/24 MRAMedia Training in Blantyre on Wednesday.
He said while meeting the set targets will require concerted efforts, MRA is implementing several growth initiatives to ensure sustainable growth in revenue collection.
Kapoloma said MRA is among others banking on the Block Management System (BMS), tax stamps and Msonkho Online.
He said: “Msonkho Online seen automation of domestic tax processes and procedures, leading to improvements in management of taxpayer compliance in terms of registration, tax filing and filing accuracy, including tax payments. BMS has already proven very crucial by assisting MRA to register new taxpayers better as well as respond to their requirements better.
“We currently have tax stamps on cigarettes, these help us ensure that all licensed cigarette distributors and manufactures have paid the relevant excise duty.
Similarly,the introduction of tax stamps on, liquor, beer and bottled water will bring the much-needed tax revenues, but also level the playing field.”
Kapoloma said to check non-compliance and tax avoidance, the public tax collectorwill be adopting modern technologies, observing that a lot of noncompliance is in the line of value added tax as traders shun from using electronic fiscal device machines.
Treasury data shows that at mid-years, tax revenue under-performed by 1.2 percent, collecting K1.03 trillion from a target of K1.04 trillion was realised.
The under-performance in tax revenue was largely on account of under collection in taxes on goods and services.
Meanwhile, domestic revenue is projected to go up at the end of the fiscal year from K2.24 trillion to K2.41 trillion.
Of the total domestic revenue, taxes will account for MK2.2 trillion while other revenues will amount to K209.34 billion.
This represents a 3.3 percent upward revision on tax revenues from the approved position.
In his 2023/24 Mid-Year Budget Review Statement, Minister of Finance and Economic Affairs Simplex Chithyola Banda observed that the country’s tax system does not conform to the principles of a good tax system.
He said: “It is a regressive tax system which has high income earners that are paying lower share of their income as taxes than the low-income earners. It is highly subsidised by the poor. The government will endeavour to achieve a progressive tax system by eliminating the unproductive and harmful tax exemptions.”
Meanwhile, one of the participants to the training, MIJ journalist Benadeta Mia said the training has been very beneficial to me at an individual level but also professionally.
“Tax issues are very complex and it is through such trainings where we get equipped with knowledge and understanding of tax matters when writing our business stories,” she said.
