Hospitality industry appreciates taxation workshops
Businesses operating in the hospitality industry have expressed appreciation to the Malawi Revenue Authority (MRA) for organizing taxation workshops in some parts of the country.
The sentiments were expressed during the taxation workshops held from 17th to 26th September, 2018 in Mzuzu, Nkhatabay, Salima, Lilongwe, Mangochi and Blantyre.
Most participants said the workshops played a critical role in filling information and knowledge gaps in as far as the administration of various taxes is concerned.
“Most of the times we fail to comply not because we don’t want to remit taxes but because we don’t know what to do. The workshop has been an eye opener since it has clarified important areas in as far as tax administration is concerned,” a participant in Salima said.
Another participant appealed to MRA to organize such taxation workshops regularly so that businesses in the hospitality industry should be informed of any amendments in the tax law.
During the taxation workshops, Taxpayer Services Manager, Nancy Mwale, and Customs & Excise Officer, Charles Mpaya, took participants through presentations on Domestic taxes and Customs & Excise incentives, respectively.
Mwale explained the administration of various taxes like Income tax, Pay As You Earn (PAYE), Value Added Tax (VAT), Withholding Tax, Provisional tax and the importance of submitting various tax returns.
“MRA issues a Withholding Tax Exemption Certificate to exempt a compliant taxpayer from being withheld tax on specified payments. It also issues a Tax Clearance Certificate (TCC), as a written confirmation that one’s tax affairs are in order at date of issuance,” she said.
However, Mwale said penalties are applicable when a taxpayer fails to remit taxes or submit a tax return.
On his part, Mpaya said the Customs & Excise Act provides incentives to investors intending to invest in the hospitality industry. He said such incentives include free import duty, free import excise and free import VAT.
“The government through the Ministry of Finance introduced special Customs Procedure Codes (CPC) to facilitate the growth of the Tourism Industry. The CPCs applicable are CPC442, CPC450 and CPC451. The purpose is to allow privileged organizations clear specified goods on duty free basis instead of the normal rates of duty in the main tariff,” he said.
He said CPC 442 allows businesses in the hospitality industry to import duty free items including air-conditioners, generators, industrial catering equipment and appliances, industrial washing machines, public address system and many more.
During the workshops, participants had the opportunity to ask questions on a number of areas including uses of taxes, determination of tax rates and the administration of Electronic Fiscal Devices (EFDs), among others.
By Wadza Otomani
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