Chakwera orders MRA, Ministries of Information and Finance to clear mist on VAT on banking services

President Dr. Lazarus McCarthy Chakwera has ordered the Malawi Revenue Authority (MRA) and Ministries of Information and Finance to furnish Malawians with tangible information surrounding the controversy on the recently introduced value added tax (VAT) on banking services.

Chakwera said he is equally disturbed with the absence of concrete information on the reasons why the banks have decided to transfer VAT on banking services to their customers.

President Chakwera addressing the press

The President made the sentiments during a press briefing held at the Kamuzu Palace in Lilongwe on Tuesday.

Turning to his recent visits to Kenya, United Arab Emirates and Scotland, Chakwera hinted that Malawi stands to benefit a lot from the trips, stating that he used his sojourns to woo international investors.

“This is what we have been talking about while in Kenya and as we were talking goods were already on their way to South Sudan. And the same when we were in Scotland it was all the same in Dubai the idea is to take the economy back on its rail,” he said.

He disclosed that he has also been invited to attend another meeting in South Africa soon. Chakwera said this is another powerful meeting for Malawi to utilize to attract foreign direct investment.

However, the President reminded Malawians of the need to actively participate in identifying solution to the country’s socioeconomic challenges.

“You might recall that when I delivered my inaugural address on Independence Day last year, I vowed to devote my time in office to making corrections to the multiple systemic problems that had ruined our economy, ruined our taxes, ruined our infrastructure, ruined our nationhood, ruined our resolve, ruined our institutions, and ruined our public services. I knew at the time that Malawi was a nation in critical condition and suffering multiple organ failure, and that the battery of treatments to be administered would be a bitter pill for all of us to swallow. That is why I also gave a warning of the sacrifices we would all have to make to nurse our failing economy back to health,” said Chakwera.

Making an allegory of a hospital situation, Chakwera said “that season of national surgery is now upon us, for on top of the crippling debt that the previous administration left for all of us to pay off, we have the task of raising money for financing the gradual restoration of the public service; for financing our adaptation to the forces of climate change; for financing our agricultural industrialization; for financing the construction of desperately needed infrastructural projects; and for financing the recovery of the private sector from the ravages of Covid-19 pandemic.”

Below is the verbatim speech of the President:

The cost of doing these things is heavy, and there is no household in Malawi that is not bearing some of that weight.

This is the painful truth. I must tell you the way things are and not feed you lies. We already know from the previous visit by the IMF that the previous Administration was even lying about the state of forex, inflation, and debt in this country.

That legacy of lies is over, and we are now in a season of confronting the truth head on.

And the truth is that if ever we needed courage to endure the pain of sowing in tears, it is now. Now more than ever, we need the courage to pay the sacrifices our country needs in order to be assured of a future harvest.

The sacrifices you are all paying is the fertilizer that the soil of our economy needs, and the investments and trade that this Administration is working hard to bring into our economy are the seed we are sowing for a future harvest. That is what the trade deals we secured in Kenya are about.

That is what the trade deal we have sealed with South Sudan is about. That is what my discussions with various investors in Dubai were about.

That is what my appeal for Climate financing in Scotland was about. And even the trade expo that I will soon be attending in South Africa at the invitation of President Cyril Ramaphosa will be for that purpose.

We will leave no stone unturned to bring trade and investment into this economy so that the sacrifices you are making will one day pay dividends. I am therefore grateful for the patience and patriotism with which you are playing your part to see this difficult task done. I thank you for your attention.

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