MRA pounces on Mapeto

Malawi Revenue Authority (MRA) has pounced on Mapeto David Whitehead and Sons (DWS) and arrested five senior officials for multiple cases of alleged tax evasion estimated at K10.8 billion.

Mapeto DWS Limited director Faizal Gaffar Latif handed himself to MRA officials at Msonkho House yesterday morning in the company of his lawyer Jai Banda while the company’s Managing Director Mohammed Gaffar, Financial Controller Abdul Rashid Bakali, Procurement Manager Yaseen Muhammad and General Manager Martin Mpata were arrested on Friday.

In an interview yesterday, MRA head of corporate affairs Steve Kapoloma said the arrests follow investigations the public tax collector carried out at the company for six weeks.

He said MRA established three cases of alleged tax evasion during the investigations.

Said Kapoloma: “The first one relates to under-declaration of sales. They were selling their products, but not fully declaring the sales to MRA which had a direct and negative impact on the revenues they were remitting to MRA with regards to VAT [value-added tax] as well as income tax.

“We have also made the arrests as regards to customs duty evasion. They were technically smuggling goods which are finished products into the country and declaring them as raw materials. This cost us [MRA] substantial amounts of revenue because with the mis-description, we were collecting less than what was supposed to be fully declared.”

He said the investigations also established that Mapeto DWS was employing expatriates and paying them appropriately, but was declaring less to MRA in terms of income tax or pay as you earn (Paye).

Kapoloma said the investigations involved examination of documents seized from the company and that the senior officials will appear before court at an appropriate time.

With the authority of a search warrant issued by the Blantyre Magistrate’s Court, MRA embarked on investigations into alleged importation of assorted goods, including fabric and accessories, various types of motor vehicle tyres and other goods at the company.

In an earlier interview, Kapoloma said the investigations were being carried out in respect of tax evasion offences and tax fraud suspected to have been committed contrary to provisions of the Customs and Excise Act, Taxation Act and VAT.

By Lloyd Chitsulo, Nation newspaper