Minibus association angry over large buses tax removal

Minibus Owners Association of Malawi (Moam) has reacted angrily to decision by the Malawi government to remove taxes on importation of large buses saying it is a recipe for disaster especially to minibus business.

Moam Secretary General Coxley Kamange told Nyasa Times  soon after Finance Minister Dr. Ken Lipenga finished reading this year’s budget presentation in National Assembly on Friday, that removing duty on large buses has the potential of killing minibus business which he claimed is key to the country’s transport sector.

Kamange further observed that the previous government made the similar move which he said ended up benefiting a pocket of individuals with ties to the ruling government.

Kamange: MOAM secretary

“As Moam we are shocked with decision by the government to quash taxes on large buses while we as minibus operators have been largely ignored. In the first place, this is not fair because almost 95 percent of the population survives on minibuses as mode of transport and very few people use buses so we are really not happy with the move.

“Imagine, currently, for every single minibus we import, we actually pay a duty fee of K1.1 million, I mean how can we be in business if the taxes are anything to by. It is very painful to note that our friends that are in big bus business have been considered, it’s very painful indeed I hope after debate government will also consider us,” complained Kamange.

He further added that removing taxes on large buses would only benefit what he called ‘a handful of individuals’ compared to over 5000 registered minibus owners he said are operating in almost all parts of the country.

But Lipenga told parliament that government observed “a deterioration in many of the large buses and high rate of accidents caused by minibuses travelling long distances. ”

He said : In order to sustain the development of this sector, Government has removed all taxes currently existing on big buses of a seating capacity of more than 45 passengers (including the driver).”

As a way forward, Kamange hinted that Moam executive would meet next week to discuss on measures to take to register their displeasure to the authorities.

“We haven’t yet lost hope because we are mindful that this is a new government, as such, among the issues to be discussed at the emergence meeting next week is to engage with the Transport Ministry officials so that they help us to seek audience with the president. It is at the meeting where we will be able to explain to her the adverse effects of giving large bus owners free ride,” said Kamange.

He added: “When Mutharika government waived duty on taxes we thought they did that with the reason to help rural people with easy access to transportation. However, we were equally shocked to see that all the big buses that were imported were busy operating in the same roads we’re operating, that time we complained that the government did not level the playing field and that is what has happened this time around, anyway we’re asking our president to intervene on the matter because it has severe economic consequences.”

This is not the first time that Malawi government has removed taxes on big buses, as it did the same during the first term of late president Bingu wa Mutharika when economist Goodall Gondwe was Minister of Finance.

However, the move was viewed by many experts as ploy by the ruling elite to open doors for party cronies to import buses in order to replace the liquidated Shire Bus Lines.

Coincidentally, it is during the same fiscal year, that saw the birth of Axa Bus Company owned by politician Mark Katsonga and National Bus Company, a shareholding company largely owned by business magnate Leston Mulli with over 70 percent of total shares.

It is against this backdrop that most Malawians are waiting to be proved right or wrong as to whether or not the current government has proposed for the removal of the bus taxes with the view to benefit few business people, as was the case previously, or it has interest of reaching out to rural masses who for a long time have had transport hurdles as most buses prefer operating in urban centers due to poor road networks in most parts of the country.

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