MRA clarifies on newly gazetted specific taxes on motor vehicles

By Chisomo Phiri

Malawi Revenue Authority (MRA) on Monday made a clarification on the newly gazetted specific taxes that have been put on motor vehicles.

Addressing journalists in Blantyre, MRA Deputy Commissioner of Custom and Excise Chimwemwe Kawalewale explained that these specific taxes are among other important things aimed at addressing valuation disputes and restrict importation of older second hand vehicles.

Chimwemwe Kawalewale

Kawalewale said, for instance, in the 2022/23 financial year alone, 290 valuation appeals were refered to MRA headquarters and out of this, 254 were on used motor vehicles with 245 cases from Songwe Border Post alone, something which is not good.

According to Kawalewale, MRA sat down and came up with new tax figures.

“We sat on huge volumes of data and analysts looked at those figures to come up with the values,” said Kawalewale.

He added that the new tax regime will benefit importers because they will now know duty in advance and this will iron out loopholes where people could undervalue the car to pay less duty.

“Consumers will know the actual value of the duty to be paid and it will benefit more the importers because they will have power, everything has been put in the open and the know the amount of taxes to pay,” he said.

Statistics also show that motor vehicles are among the top three imports which are draining the country’s foreign exchange.

The Customs and Excise Tariffs Amendment Number 4 Order 2023 which has introduced fixed duty on imported vehicles, was signed by Finance and Economic Affairs Minister Sosten Gwengwe and comes into operation on July 15 2023.