Despite missing the projected tax revenue targets in April and May this year, the Malawi Revenue Authority (MRA) has already recorded a surplus of K34.65 million in the 2016/2017 financial year ending this month.
The Authority has accumulatively collected K693.60 billion against a projection of K658.87 billion.
MRA Head of Corporate Affairs Steve Kapoloma, however, attributed the tax revenue out turn in the month of May to under collections in PAYE Corporate Tax and Import Vat.
In the month (May) under review, the Authority collected K58.67 billion against a monthly projection of K61.42 billion, representing a performance rate of 95.6 percent.
According to MRA, a total of K25.60 billion was collected in income and profits taxes against a projection of K33 billion, representing 78 percent of the target.
“The taxes that contributed to the deficit include PAYE, NRT, company assessments and withholding tax,” said Kapoloma.
In Pay As You Earn, K17.44 billion was collected against K23.40 bollion, translating to 75 percent of the target. The targeted was missed due to non-remittance of PAYE from some statutory corporations and government ministries.
Fringe Benefits (FBT) and Non-Resident Taxes (NRT)ppm collectively registered a total K699 million against its target of K900.37 million.
FBT exceeded its target of K119 million by 89 percent and NRT underperformed due to less transactions which entailed less remittances to non-residents.
Likewise, all taxes lines under the Corporate Tax fell short of their monthly targets. A total of K2.06 billion was collected under this category against a monthly target of K2.68 billion, registering 77 percent of the target.
Withholding Tax registered a collection of K5.39 billion against a projection of K6.01 billion.
“The performance is explained by low prices of other agricultural products other than tobacco which has negatively affected withholding tax collections while Company Assessments collections have been impacted by more requests for offsets of tax liability with tax refund amount, said Kapoloma.
MRA, an agency of the Malawi Malawi and responsible for assessment, collection and accounting for tax revenues, was established by an Act of Parliament in 1998 and was launched in February 2000.
It was formed to improve on the functions previously carried out by Divisions of Customs and Excise, and Income Tax in the Ministry of Finance.
The Authority operates as a government tax administration agency under the Ministry of Finance.
The revenue that the Authority collects goes to Government for implementation of various socio-economic development projects such as the constructions of roads, bridges, schools health facilities and provision of social services.
These include national security, provision of salaries for civil servants such as the police, the army, judges, doctors, nurses and teachers.Follow and Subscribe Nyasa TV :