Key initiatives set to advance: MRA’s K3.26 trillion collection

The Malawi Revenue Authority (MRA) has stressed that is set to broaden the tax base by taxing more goods and services as well as addressing revenue leakages in the new 2024/25 fiscal year.

The Authority’s Head of Corporate Affairs Steven Kapoloma said various strategies have been put in place to increase the number of taxpayers and ensure equitable tax contribution, targeting a revenue goal of K3.26 trillion for the fiscal year 2024/25.

“Some of the measures include the tax stamps. This is a physical or digital sticker placed on a product to indicate that Excise Tax has been paid. The stamps are aimed at protecting local and legitimate industries from unfair competition of illicit, smuggled or counterfeit products.

“This means all excisable products and imports such as carbonated drinks and beers will be easily identified on the market allowing more producers and importers to pay their taxes thereby leveling the playing field. The process will facilitate new registrations, as well detect instances of underreporting and non-payment of excise tax and other related taxes,” Kapoloma said

He added that the Authority will enhance third party data matching where there will cross-reference taxpayer information obtained from external sources with the data held in its various systems.

“It will also involve cross-referencing information held in one of its systems with other systems in the organization. The purpose of third-party data matching is to enhance tax compliance by identifying discrepancies, inconsistencies, or omissions in taxpayers' reported income and transactions,” he said.

Kapoloma added that MRA will bring in a VAT Electronic Invoicing System, an upgrade from the current EFDs.

“The VAT Electronic Invoicing System will be open to more advanced technologies to enhance business functionalities, system performance, security, and user interface. 

“The system upgrade is aimed at tackling VAT fraud and evasion by improving compliance management, reducing operational cost for both the taxpayers and the tax administration, improving efficiency in tax administration and enhanced system ownership and control since the system will be used on any machinery by traders such as Point of Sale Devises (PoS), cash registers and even phones,” said Kapoloma.

In the just ended 2023/24 fiscal year, MRA collected a total of K2.186 trillion against a target of K2.180 trillion.

BY HENRY MCHAZIME