The Malawi Revenue Authority (MRA) has introduced the withholding Value Added Tax (VAT) system which will be effective from June 1 2021.

The development will see some institutions will be remitting VAT on behalf of suppliers which is more convenient than the previous arrangement of suppliers remitting the tax, according to  MRA Corporate Affairs Manager Steven Kapoloma.

 The new system will enable the revenue collection body to properly account for revenues. “We expect to increase VAT inflows because we have created a system in which all the revenue will be accounted for. We expect an increase in revenue since we have closed the loophole,” he said.