Commercial banks under the banner Bankers Association of Malawi (Bam) have reiterated their displeasure over the introduction of 40 percent corporate tax on annual profit above K10 billion.
The banks have since rated the tax, which Minister of Finance KAWAWA—This is not fair announced in March, as selective and punitive.
In an interview on Thursday, Bam President Macfussy Kawawa said the banks were seeking an audience with Gwengwe to voice out their concerns.
“We find it appropriate that we engage the authorities to express our views such that there can be a correction in many forms, either a reversal or widening the coverage.
“We are of the view that if it is temporary, we expect that we will be advised on when it will be reversed,” Kawawa said.
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In his 2023-24 budget winding up statement in Parliament in March, Gwengwe said if a bank makes profits of up to K10 billion, the standard corporate tax rate of 30 percent will be applicable while all profits above K10 billion will be treated as excess profits and taxed at 40 percent.
He said the ‘temporary tax measure’ was aimed at raising resources to assist in rebuilding the affected areas.
Commercial banks have lately come under heavy scrutiny for posting ‘supernormal profits’.
Some commentators have rated the banks’ performance as ironic, as the operating environment remained volatile.
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But the banks say such profits are a reflection of the industry’s soundness.
