The Malawi Revenue Authority (MRA) has disclosed that it collected over K185.6 billion (about $431m) since July 2013, beating its half year target by about 20 percent.
The 2013/14 budget projected a total tax revenues for the fiscal year of K328.1 billion (about $763m).
The December 2013 tax outturn, however, indicates that between July and December 2013, MRA collected K81.5 billion in income tax—pay as you earn (PAYE) and corporate—while K83.4 billion was collected from goods and services—value added tax (VAT) and excise duties—beating its projections in both.
The figures are coming at a time when Malawi’s economy has been hit hard in the last four months following the revelation of massive looting of government resources at the country’s seat of government Capitol Hill.
The looting being connected to the ruling elite is now dubbed ‘cashgate’.
The tax out-turn indicates that MRA struggled to meet its projections under international trade—import duty and prepayments—by collecting K21 billion about K2 billion below its projection. MRA also missed its projection on other taxes.
In its report the tax collector explained that the good performance in the last six months reflects strong growth in PAYE, withholding tax and VAT due to good economic performance and increased capacity utilisation.
In December, revenue collected stood at K29.38 billion, higher than the preceding month and also 15 percent above the month’s target.
In the month, MRA collected K11.79 billion from income and profits while Paye at K8.08 billion, over-performed its projection by 36 percent with corporate tax underperforming its monthly projection by 38 percent.
The tax collector attributed the underperformance in corporate tax to the fact that only a few payments fall due in December because most taxpayers prefer to settle their obligations before the month since it is considered a short month due to the festive season.
MRA has noted that apart from local excise, all taxes on goods and services exceeded their respective targets during the month under review. The outturn shows that K13.71 billion was collected under the line, registering a surplus of 13 percent above the month’s target.
In the month, MRA collected K10.47 billion on VAT, 19 percent above target.
On international trade, the tax collector collected K3.79 billion in import duty, about one percent below its projection for the month.
MRA explained that the decrease emanated from continued importation of non-dutiable agriculture-related items such as fertiliser.
According to the 2013/14 budget, Malawi’s total revenues and grants are expected to amount to K603.4 billion.
Total domestic revenues are projected at K363.1 billion, representing 60 percent of total revenue and grants while K240.3 billion are donor grants, representing 40 percent of total revenue and grants.Follow and Subscribe Nyasa TV :