MALAWI REVENUE AUTHORITY PROFILE

The Malawi Revenue Authority (MRA) is an Agency of the Government of Malawi responsible for assessment, collection and accounting for tax revenues. MRA 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 Departments 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 money that the Authority collects goes to Government for implementation of various socio-economic development projects such as the construction of roads and bridges, schools, health facilities and provision of social services like national security, provision of salaries for civil servants including the police, the army, judges, doctors, nurses and teachers.

ORGANISATIONAL STRUCTURE

The MRA is overseen by a Board of Directors and headed by a Commissioner General to provide leadership, strategic direction and control. In pursuance of these duties and to accomplish the mandate of MRA, functional departments and divisions are in place.

MRA has two revenue divisions of Customs and Excise and Domestic Tax Divisions. It also has supporting divisions and departments namely Finance, Administration, Legal, Information &Technology, Tax Investigations, Policy Planning & Research, Internal Audit, Security and Public Relations & Taxpayer Education.

The Customs and Excise Division administers and enforces the Customs and Excise Act. The division collects Import and Excise duty and Import VAT, trade statistics, protects the community from entry and exit of prohibited goods and facilitates trade.

The Domestic Tax Division administers the Taxation and VAT Acts. The Division collects direct Income Taxes from individuals and corporations. These are in form of Pay As You Earn (PAYE), Provisional Tax, Fringe Benefit Tax and Withholding Tax. The division also collects domestic VAT and domestic excise.

MRA has three regional offices in Blantyre Lilongwe and Mzuzu, it has 32 offices spread across the country from Nsanje to Chitipa.

MISSION STATEMENT

To maximise revenue collection through fair, efficient and transparent administration of Malawi tax and Customs laws while providing high quality service to all taxpayers.

VISION STATEMENT

To be a modern, professional and efficient revenue authority that provides first class service to all stakeholders

CORE VALUES

As the Malawi Tax Administration, we wish to establish ourselves as a responsible organization, providing quality service to the Malawi nation that is based on:

Professionalism and service excellence

We are committed to the highest standards of achievement obtainable through dedication. We will provide a relevant and timely service to all our clients and provide information to which a person is entitled promptly and in an easily understood form. We will make sure it is accurate, current and complete.

Equity and fairness

We will treat all people fairly and apply the law consistently and responsibly as well as administer all the requirements reasonably. We will base actions, decisions and advice on consideration of all relevant facts, and implement policy and programs equitably.

Integrity and trust.

Our organization’s foundation is the integrity of its people. We will, therefore, be honest with our clients, colleagues and the community in general and we will not tolerate unethical behavior.

Efficiency and accountability 

We will achieve results through the best use of the organization’s financial, physical and human resources.

Teamwork

We will develop and foster mutually beneficial working relationships that balance our hopes, confidence and goals for the future. 

Courtesy and respect

We will treat our clients, colleagues and the public with dignity, courteousness and with utmost respect to their rights, responsibilities and aspirations.

FUNCTIONS OF THE MRA

The main functions of MRA as stipulated in the MRA Act are:

• Assessment, collection and receipt of specified revenue
• Promotion of voluntary compliance to the highest degree possible
• Improvement of the standard of service given to taxpayers with a view to improving efficiency and effectiveness and maximizing revenue
• Counteracting fraud and other forms of fiscal evasion
• Advising the minister of finance on matters of revenue policy and administration and collection of revenue

• Subject to the stated tax laws, performing any other duties related to revenue as the Minister of Finance may direct

CONTINUED REFORMS IN TAX REVENUE ADMINISTRATION

Since inception the Authority has continuously instituted reforms aimed at improving the efficiency and effectiveness of MRA so as to increase revenue collection. Reforms are also aimed at promoting voluntary tax compliance to the highest degree possible to maximize revenue collection and decrease the cost of collecting revenue.

Three notable reforms are the integration Income Tax and Value Added Tax (VAT) divisions into Domestic Tax Division which also administers Domestic Excise, the launch of the Large Taxpayer Office (LTO) and the introduction of Destination Inspection.

DOMESTIC TAXES

The introduction of Domestic Tax division is seen as a big achievement because this will enable MRA to effectively serve the taxpayers better. Instead of two officers visiting the same taxpayer for two different taxes, they will now be visited by one officer.

The LTO is responsible for the operational functions for large taxpayers. These taxpayers are few but have a significant impact on revenue. They contribute about 75%of all domestic taxes. For this reason, MRA allocated the best human resource in the LTO to ensure provision of first class services to taxpayers.

CUSTOMS AND EXCISE

Government phased out the pre-shipment contract with Intertek and the Malawi Revenue Authority assumed the responsibility of valuation and classification of imported goods under the Customs and Excise Division. This means that MRA will now inspect and value goods and charge duty accordingly after they have been imported.

The authority has also successfully established the risk management unit, the post clearance verification unit and the enhancement of Automated System for Custom Data (ASYCUDA) system.

Customs reform will continue with the adoption and implementation of several recommendations that were made by the World Customs Organisation (WCO) mission that visited Malawi in March 2007. This will be done to ensure that taxpayers are given much priority by simplifying procedures, in return MRA expects tax payers comply with all tax obligations.