Malawi mobile companies protest corporate tax hike-report

Cellphone operators have protested decision by the Malawi government to hike corporate tax from the normal 30 percent to 33 percent which government charges on the mobile firms plying trade in the country, a mid week Business Times publication has revealed.

Senior officials at the country’s two leading mobile firms, Airtel and TNM Limited, told the paper that the tax hike is counterproductive and a discouragement on their side in terms of further investments.

“It is unfortunate that we (telcom companies) have been singled out for the tax hike. There is an element of discrimination here which is of concern to us as a company,” reacted  Airtel’s Managing Director Saulos Chilima, adding, “the tax hike is punitive and we will ask the Malawi government to revise it.”

Chilima: Review the tax

Commenting on the issue, TNM’s publicist Wilma Chalulu described the development as unjustifiable.

She argued that as a company TNM is already making a significant contribution to government coffers through taxes and levies, besides paying another five percent levy on revenue to communications regulator Macra.

“Our capital investment is huge and this increase will have an impact on some investments that may have gone into the network. The impact may not be apparent now but certainly in the near future, this will be felt,” said Chalulu as quoted by Business Times.

She added: “As far as our profits are concerned, we are a publicly listed company; therefore all the details of our finances are reported in our annual reports.”

On his part, finance Minster Dr. Ken Lipenga told the paper that the tax hike was introduced in response to calls by members of the general public through the pre-budget consultations including the private sector.

He however, assured the mobile operators that the proposed hike is subject to review.

Said Lipenga: “We will always be reviewing these taxes…we know that there are so many companies in the country making profits as well and next time we will target them.”

Lipenga tabled in what is billed as President Mrs. Joyce Banda’s maiden recovery budget for 2012/2013, on June 8.

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