On MRA revenue collection

Recently, Malawi Revenue Authority (MRA) published tax revenue report for the month ending July 2012. This is a recommendation from the International Monetary Fund (IMF).

The report shows that MRA collected K21.4 billion, beating its target of K20.4 billion.

The revenue collection body plans to collect K245.9 billion to feed the national budget of about K403 million.

The balance of about K157 billion will be borne by our donors and other non tax revenue sources.

By the way, do not ask me if I believe these figures. I know there are some sceptical minds who have questions about these unaudited figures.

Well, spare me the scepticism because I do not think they have ‘doctored’ the figures.

You may think I want to write about MRA and how it behaved with figures last time. No! Not this time.

 I will not touch the scandal in which MRA cooked up figures and edited its report to paint a picture that our fiscal policy was on track.

Of course, no one has been held responsible for the embellished figures. Neither the Minister of Finance nor the Commissioner General is responsible for the embroidered report.

Today, I just want to commend MRA for being transparent enough by publishing their figures.

This, I believe, is a step in the right direction. With the figures, whoever thinks can crunch them should be able to project whether we will or will not be able to meet our annual tax target of K245.9 billion.

My plea is that other government agencies and departments should be able to learn from MRA.

I am sure that if MRA did this in good faith, then it will help people to monitor the performance of our financial plan, the national budget and provide the necessary advice where necessary before the country gets into a ditch.

Accountants and economists will agree with me that budgetary control and, in this case, policy control, is empty if we only concentrate on monitoring revenue collection and disregard the expenditure side.

Both revenue and expenditure are important for a proper budgetary control and analysis. We should be able to know where the rot is, who is causing it and what can be done to correct it.

Looking at the 2012/13 budget statement, there are some indicators whose progress most people would be interested to know. Let’s say on a monthly basis.

I know some people may say the exercise will be costly on the part of government. But we need to know that it will help in saving our hard-earned resources and arrest corruption.

Well, we know the Farm Input Subsidy Programme (Fisp) has about K40.6 billion, State residences kapinga has K2 billion, about five percent of the Fisp envelope and regrettably, the Green Belt Initiative has only K1 billion.

Without necessarily demeaning our Members of Parliament and undermining the role the civil society plays in scrutinising our policies and providing checks and balances on how the government conducts itself, I am sometimes left with a feeling that most of these people have degraded themselves to mere ‘hand clappers’, have personal agenda or they do not understand the issues at hand.

That said I believe the government will move a step further in ensuring transparency and accountability if other departments follow the MRA example.

I know some lawyers will tell me that this is not in our Constitution. Yes, but I hope you agree that this can take us into the right direction.

Let me once again say, it is meaningless to only be told of revenues that have been collected and not what has been spent.

If government had published both revenues and expenditure, it would have been easier for stakeholders to monitor both the fiscal and monetary policy.

For instance, this year’s budget talked of an inflation rate of 18 percent, but today we are way above 20 percent and mind you, we are yet to peak. While appreciating that the 18 percent target is an average, the way the general rise in price is moving points to a higher than projected inflation rate.

The statement also talked of a no net domestic borrowing by the end of this fiscal year. The budget also talked of construction of about 2 000 classroom blocks this year, where are we so far? How many of these projects have we initiated?

I believe with enough reliable information stakeholders, donors, civil society and an ordinary person in the village should be able to point out where the decay is coming from if there is any rot.