The private sector and a tax expert have called for the extension of voluntary compliance window (VCW) to allow businesses recover from the effects of the Covid-19 pandemic.
Institute of Chartered Accountants in Malawi (Icam) and Malawi Confederation of Chambers of Commerce and Industry (MCCCI) have proposed the extension of VCW from October 2020 to March 2021.
Icam chief executive officer Francis Chinjoka Gondwe said in an interview that businesses are hit hard by Covid-19, resulting in cashflow problems; hence, the proposal for the extension.
On her part, MCCCI director of business environment and policy advocacy Madalitso Kazembe said the extension should be considered because companies continue to struggle to stay afloat.
She said: “Of additional importance, government should pay value added tax and withholding tax refunds to improve businesses’ liquidity positions to enable them meet wages and statutory obligations such as taxes.”
Tax expert Emmanuel Kaluluma of EK Tax Consultants said VWC acts as an incentive to taxpayers and also boosts revenue for the government.
Malawi Revenue Authority head of corporate affairs Steven Kapoloma in an interview projected that within six months, tax revenue worth K1.9 billion will be waived with K8.5 billion collected.
But Ministry of Finance spokesperson Williams Banda said: “Treasury is aware that the voluntary compliance window is up to October 2020 only, and will ensure this is adhered to.”
He urged taxpayers to use the current window, which expires at the end of October this year.