MRA banks on new initiative to boost revenue
Malawi Revenue Authority (MRA) says it seeks to boost revenue collection through the implementation of Authorised Economic Operator (AEO) programme.
AEO is a voluntary certification programme aimed at serving compliant taxpayers by giving them priority treatment to achieve trade facilitation to boost tax revenues.
In a statement, MRA commissioner general Tom Malata said the revenue collection agency has just finished piloting the programme, which is being implemented in phases.
He said the AEO is part of reforms aimed at helping Malawi to improve further on the World Bank Doing Business Index in which the country is on position 109 based on the latest ranking.
Said Malata: “Malawi has moved two steps up on the World Doing Business ranking by the World Bank and when they were in the country for the survey, we received commendations for rolling out the AEO programme.
“We are optimistic that it will contribute to more favourable ranking. Currently, the programme in Malawi is in its second phase. We set up a project team that implemented conceptualisation and administrative preparations.”
The pilot phase of the programme was initiated from June 2018 where six entities were identified.
Malata said the second phase of the AEO programme is focussing on accreditation of bonded warehouses and clearing agents and that transporters and freight forwarders will follow in the third phase.
Tax expert Emmanuel Kaluluma yesterday said the big challenge with MRA officials has been mindset as some of them advance personal interests at the expense of good ideas the institution has.
He cited the establishment of the large taxpayer office, which is no longer operational due to lack of consistency.
“I doubt this programme will work this time around. For your information, the large tax office was formed after realising that 80 percent of budget revenue is paid by 20 percent of the taxpayer population.
“Therefore, the office was established to look at the larger taxpayers with utmost priority, but it is not working as a result larger taxpayers are looked at like any taxpayer who contributes only 20 percent,” said Kaluluma.
He advised MRA to make the large taxpayer office work first then harness it with the new AEO innovation.
Meanwhile, Treasury posted a K17. 7 billion budget deficit in September, compared to K41.1 billion in August, according to the Reserve Bank of Malawi.
The deficit is lower compared to the K34.1 billion posted in July, the first month of the 2019/20 fiscal year due to undercollection by MRA.
Last week, officials from World Customs Organisation were in the country to conduct a validation training of the AEO programme.
