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MRA to Implement Advanced Income Tax On Imports

By Zainab Phiri

MRA officials briefing the media on Three Percent Advanced Income-Photo Arkangel Tembo,Mana

Blantyre, April 27, Mana: Malawi Revenue Authority (MRA) will from May 1, 2022 start implementing a three percent Advanced Income Tax (AIT) on imported goods for commercial purposes.

MRA’s Deputy Commissioner of Customs and Exercise, Chimwemwe Kawalewale announced this on Tuesday during a press briefing saying that the AIT is aimed at bringing the informal sector into the tax net and enhance tax compliance.

“MRA is implementing Advance Income Tax on imports to level the playing field and ensure that all businesses are paying their fair share of taxes due.

“For a very long time, MRA has been accused of not doing enough to bring the informal sector or ‘brief case businesses’ and that has put a lot of burden on few taxpayers.

“The implementation of AIT is, therefore, one of those measures we are employing to register more people into the tax net and grow the tax base,” he said.

Kawalewale said compliant registered taxpayers would not be subjected to AIT because they already have valid Tax Clearance Certificate (TCC) or Withholding Tax Exemption Certificate (WHTEC) issued by MRA.

“If the taxpayer is compliant but does not have a Tax Clearance Certificate or Withholding Tax Exemption Certificate at the point of entry into the country, the tax deducted will be credited to his or her tax liability after submitting tax returns to MRA at the end of the accounting year.

“Let me mention that one would not be asked to pay the tax before importing the goods. One would only be required to pay AIT at the border at the time of entry on the Customs Value for Duty Purposes,” he added.

Making a presentation on AIT, Taxpayer Education Manager, Mc Hizzal Kawanga said apart from exempting imports by persons who have produced a valid WHTEC or TCC, imports by persons for personal use would not be subjected to AIT as well.

“Further, importation by government Ministries, Departments and Agencies (MDA’s) as well as imports by persons exempted from tax under Taxation Act will not be subjected to AIT.

“On goods imported for personal use, the nature and quantity of goods as well as the frequency of importation will be used to determine whether goods are for commercial use or for personal use,” he said.

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