Malawi Revenue Authority (MRA) has managed to collect tax revenue for the month of October amounting to K37.43 billion, representing 20.3 percent higher than the projection.
The October generated revenue is 2.3 percent more than what the institution raised in September.
In a detailed report seen by Nyasa Times, the tax-collector has released, reveals that the tax revenue was characterized by relatively strong growth in Pay as You Earn (PAYE), Fringe Benefit tax (FBT), Company tax, VAT and local excise tax resulting from continued good economic performance.
According to the report, MRA managed to hit Income and Profits in a total of MK19.68 billion; this was 35.1 percent above the projection for the month, and the institution said this resulted mainly from all tax lines under this category except for company assessment.
“At MK6.43 billion, PAYE over-performed its monthly projection by 17.0 percent but was 12.1 percent below the September 2013 collection. The performance of PAYE will remain robust against the backdrop of continued economic recovery. A total of MK1.35 billion was collected from Fringe Benefit and Non-Resident taxes as taxpayers adhered to filing dates,” reads the report in part.
The report discloses that most taxpayers paid Assessment tax in advance through Provisional and withholding taxes thereby precipitating the under-performance in company assessment.
“Notwithstanding an under- performance of 62.2 percent in company assessment, corporate income tax totaled MK11.90 billion as both Withholding and Provisional taxes exceeded their targets by 26.8 percent and 63.8 percent, respectively. This outturn reflected significant improvements in business conditions for both large and small businesses”.
MRA says it managed to generate MK14.22 billion, taxes on good and services with 16.7 percent above the month’s target.
The tax collecting body says this resulted from positive performance in all the taxes under this category, including VAT and Excise duties.
“A total of MK10.48 billion was collected under VAT attributable in part to enhanced monitoring, investigations and enforcement. Domestic VAT exceeded its target by 17.0 percent owing to increased capacity utilization. On the other hand, the over-performance under Import VAT was on account of VAT collected under industrial rebate goods.
“Excise tax amounted to MK3.74 billion. Local excise benefited from increased domestic industrial production as well as higher consumption. Import excise registered a deficit of 3.46 percent on account of a 21.8 percent increase in the value of imports of non-excisable goods to MK60.32 billion”.
On Import Duty, MRA collected MK3.3 billion and missed its monthly target by 19.2 percent on account of a marginal increase in project-related duty free imports.
While all tax lines under the other category over-performed their monthly targets, a deficit of 47.6 percent under penalties resulted in an overall deficit of 7.3 percent for the category, the report indicated.