Malawi Revenue Authority rakes in K553 billion within four months
Misses third quarter target by K4.73 billion
The Malawi Revenue Authority (MRA) said it collected K553.58 billion within a four-month period from October 2022, beating its cumulative target by K6.52 billion.
Figures which MRA Commissioner General John Bizwick presented to journalists Wednesday show that the revenue collection body had a target of K547.06 billion for the period under review.
However, in the third quarter of the 2022-23 financial year (between October and December), MRA missed its revenue collection target by K4.73 billion as it collected K396.63 billion. This was against a K396.63 billion target.
In January 2023 alone, the revenue collection body beat its target by about K16 billion, having collected K161.6 billion from a target of K145 billion.
In his statement, Bizwick rated the performance as a mixed bag.
He attributed the third-quarter below-target performance to intermittent power supply, delays on implementation of tax stamps, and delays in remittances by government ministries, departments and agencies.
He also attributed the performance to continued volatility of the operating environment where some sectors continued to nurse effects of external shocks.
“Although sectors such as those who use fuel and energy are not performing well, sectors such as banking and insurance continue to perform well and these offset a negative performance that we can encounter,” he said.
Meanwhile, our tabulation shows that during the first 10 months of the 2022-23 financial year, MRA collected K1.301 trillion.
When presenting this year’s budget, Minister of Finance and Economic Affairs Sosten Gwengwe estimated domestic revenues at K1.636 trillion, of which tax revenues were estimated at K1.528 trillion while other revenues were projected at K107.8 billion.
In an interview Wednesday, taxation expert Emmanuel Kaluluma said it will be hard for MRA to meet the overall target for the year as businesses continue to face myriad challenges.
Among other things, the economy is riddled with persistent power outages, which are affecting the cost of production, coupled with forex scarcity and elevated cost of living.
However, Kaluluma said MRA should treat tax non-compliance with utmost seriousness if it is to meet its set targets.
“There is a lot of noncompliance in the country where businesses and individuals who were supposed to be paying tax are not paying. Therefore MRA should try to fill this gap,” Kaluluma said.
Malawi’s budget encounters a deficit every year which is financed by borrowing whose huge chunk is domestic.
Justin Mkweu is a fast growing reporter who currently works with Times Group on the business desk.
He is however flexible as he also writes about current affairs and national issues.