Rédaction Africa Links 24 with Times News
Published on 2024-03-21 08:09:18
Hundreds of vendors in Lilongwe poured onto Kamuzu Procession in a march aimed at pressuring the Malawi Revenue Authority (MRA) to reverse its decision to increase duty on second-hand clothes to $2.5 per kilogramme. This march came after Minister of Finance Simplex Chithyola Banda announced new tax measures for customs and excise, which took effect on March 15. The vendors had been advocating for the reversal of this hike for days.
In response to the protests, MRA decided to revert to the previous duty rate of $1.9 per kg. Deputy Commissioner Khumbo Gondwe of the tax body’s Lilongwe Port confirmed that the reversal had been implemented following discussions between the government and stakeholders. The announcement was made as vendors were already marching towards MRA offices, where they were informed that their grievances had been heard.
MRA Commissioner General John Biziwick issued a circular announcing the reversal, stating that the duty rate for used clothes remains at $1.9 per kg. This decision brought relief to vendors like David Kathumba, who operates at Tsoka Market and expressed concerns about the impact of the duty hike on their businesses.
The budget statement presented in Parliament included other tax measures such as the removal of import duty and excise on electric motorcycles, as well as an increase in import duty on finished iron sheets. The amendments also introduced duty-free importation of certain motor vehicles for returning residents and restrictions on duty-free importation of building materials for the tourism sector.
However, the Used Car Dealers Association (UCDA) raised concerns about the government’s change in the duty calculation system for clearing used motor vehicles. The introduction of fixed rates for second-hand vehicles and the shift to an ad valorem tax method faced criticism from car dealers. The UCDA petitioned Parliament expressing displeasure over the government’s decision to revoke specific taxes in favor of the ad valorem tax method.
UCDA President Themba Mkandawire expressed feeling betrayed by the government’s actions, as the revocation of specific taxes had a significant impact on their ability to pay duty for imported vehicles. Mkandawire highlighted that MRA’s announcement to auction vehicles at border posts posed a serious setback to the car dealers who considered those vehicles as capital.
Vice Chairperson for the Budget and Finance Committee of Parliament, Ismail Mkumba, assured the UCDA that their petition would be treated as a matter of urgency. The contentious issue of the duty calculation system for used motor vehicles highlighted the challenges faced by vendors and car dealers in navigating the tax policies implemented by the government.
Read the original article on The Times
