The Malawi Revenue Authority (MRA) owes Northern Region tobacco growers in excess of K300 million in withholding tax refund dating back to 2010.
But MRA head of corporate affairs Steve Kapoloma in an interview last week explained that the public tax collector is addressing the issue first with the clubs and then individual growers.
Withholding tax is an advance payment on income tax deducted from specified payments and the current rate in the tobacco industry is at three percent.
MRA then refunds those qualifying farmers after sbmitting relevant documents to the tax authority.
Last week, some of the growers delivered a petition to MRA regional office in Mzuzu to compel the tax body to pay or risk court action.
One of the farmers, Blester Mwenendeka from Rumphi, who said is owed K2.5 million dating back to 2012, said the delay has affected his cash flow and access to farm inputs.
Agreeing with the growers, Tobacco Association of Malawi (Tama) chief executive officer Felix Thole said the complaint from growers is genuine.
“We have been taking this issue to government, but farmers are not being helped,” he said.
But Kapoloma said some problems in refunding the money have come due to bloated number of club members against the required number stipulated in the tobacco regulations.