Small and medium taxpayers are losing tax cases because of lack of information on tax dispute resolution process, an analysis of the country’s tax administration shows.
The analysis is contained in a paper titled Assessing the Performance of African Tax Administrations: A Malawian Puzzle by Malawi Revenue Authority (MRA) director of policy, planning and research Waziona Ligomeka published on the International Centre for Tax and Development website www.ictd.ac.
He said this is unlike large taxpayers who have access to specialised tax advice, including MRA officers assigned to each large taxpayer and lawyers who are aware of the dispute resolution process.
Ligomeka, a former chief economist in the Revenue Policy Division of the Ministry of Finance, Economic Planning and Development, said the dispute resolution process in the country is comprehensive, providing recourse to independent arbitrators and the courts.
He said: “The majority of cases end with MRA and they are not appealed because most taxpayers are not aware of the dispute resolution process.”
Taxation expert Emmanuel Kaluluma, who is a senior tax consultant at E.K. Tax Consultants, said on Tuesday that with large corporations, the risk of losing tax is more than small firms.
He, however, said there is need for increased tax education to increase compliance to avoid being chased.
In the 2018/19 fiscal year, Treasury laid out reforms that were to culminate into the establishment of a Tax Revenue Appeals Tribunal through an Act of Parliament.