Malawi Revenue Authority continues to underperform, misses revenue target by 13 percent
Malawi Revenue Authority continues to perform poorly after missing another revenue target and economic commentator worry that implementation of the government budget for various public services will be affected.
At a time government is struggling to minimise budget deficit through constrained spending, Malawi Revenue Authority has announced that it missed its revenue target for June 2015 by K6.1 billion, or 13 percent, having collected K41.65 billion against the projected K47.7 billion.
Malawi Revenue Authority has been struggling to collect taxes since the changes were made to its top administration last year.
With the tax collecting body tasked to collect about K592.4 billion in 2015\16, Chancellor College economics professor, Ben Kalua, says it is unlikely that revenue collection will improve at MRA, looking at the economic situation in the country.
He said meeting government’s revenue targets would be a far fetched dream owing to poor private sector performance.
“As we know, the budget is premised on heavy assumptions about self reliance. That self reliance also assumes that they need to be taxing the private sector heavily,” he said.
Kalua has since predicated a poor performance of the budget owing to the pressure on the supply side, saying the financial plan is operating under unrealistic assumptions.
He said it is clear on the market that businesses are struggling in their performance and would not pay taxes to MRA as expected.
“The budget has been under pressure even before it was approved as it is full of unrealistic assumptions,” said Kalua.
Economics Association of Malawi (Ecama) president, Henry Kachaje, said recently that most businesses may not perform as expected in the first quarter of the financial year owing to the poor economic performance and low agricultural output.