Mzuzu Chief Resident Magistrate’s (CRM) Court on Wednesday convicted five Chinese nationals of tax evasion on their own plea of guilty.
Public tax collector Malawi Revenue Authority (MRA) took the five Chinese nationals and a Malawian businessperson to court for allegedly failing to issue and retain receipts using electronic fiscal devises (EFDs) after selling goods contrary to Section 63 of the Value Added Tax (VAT) Act.
However, while the Chinese nationals pleaded guilty and were convicted, the Malawian, Roman Mkandawire of Chimeto Investment, pleaded not guilty to the charge.
Under the VAT Act, businesses with an annual turnover of at least K10 million are supposed to issue EFD receipts or invoices to customers as proof of sale and VAT compliance.
The six were arrested in Mzuzu on Monday after MRA conducted random inspections to verify EFD use compliance among businesses.
Mkandawire is accused of failing to remit K4 950 VAT proceeds from a mini-cooker sale to MRA.
He has since been granted bail by Mzuzu senior resident magistrate Austin Banda with a K250 000 cash and a non-cash surety of K400 000.
In the other hearing, CRM Texious Masoamphambi heard that the suspects evaded tax by issuing manual receipts after selling assorted items to customers.
The court has since fined the five K650 000 each for failing to issue receipts and K650 000 each for not using EFDs.
The Chinese nationals have been identified as Liu A.I. Jun of Juan Fen Supermarket, Yunguo Feng of Jie Jie Company, Liqin Xie of XLX Shop, Yuefang Wang of WQY and Feng Yun Mei of Snowman.
MRA was represented by its corporate secretary Felix Tambulasi and his colleague Chiwala Chipeta while Wesley Mwafulirwa of John Tennyson & Associates represented the businesspersons.
Mwafulirwa said he was happy with the sentences as he had appealed for leniency because the Chinese nationals were employing Malawians in their businesses.