VCW key to flushing out punitive taxes

Malawi Revenue Authority (MRA) has said the recently introduced Voluntary Compliance Window (VCW) is the only key to ending punitive tax-related penalties in the country.

MRA commissioner general John Bizwick said this on Friday when he addressed various tax payers in Mzuzu on the need to pay tax and the need to utilise the VCW.

He said currently people are exposed to punitive taxes because some of people do not pay tax to reduce the tax base. He said it is painful to see that a big chunk of people’s earning is claimed by government just because other people do not pay tax.

The commissioner said if all people can be tax compliant, the tax base will be increased and government will reduce the tax rates in the coming budget. He assured Malawians that they are key to tax rates reduction.

“If more people come in to pay tax, the tax base will be widened and government will revise the rates. If you check other countries you will find that their VAT is 14 percent and we can be able to do that,”said Biziwick.

He also called on tax defaulters to take advantage of VCW to regularise their taxes and be able to transact business normally, adding MRA will pounce on defaulters that will not participate in the window.

Biziwick said the body has a clue to the likely defaulters, stating people with posh cars are among the major suspects. He said a number of cars have tax defects and warned the owners to utilise the window.

“I would like to encourage you, to take advantage of the window period now. When you have paid the taxes you owe, your tax affairs will be regularised. You will then be considered for tax clearance certificate, withholding tax exemption certificate or your imports may not be subjected to intense scrutiny, among other incentives that MRA provides,” said Biziwick.

He warned the defaulters against conniving with MRA officials to regularise their tax in a crooked way, arguing the MRA has the capacity to track such malpractices since it is automated.

MRA has recruited over 140 people to spear head the exercise.