Malawi’s Minister of Finance and Economic Affairs, Simplex Chithyola Banda, has presented a revised budget for the 2024-25 fiscal year. The revised budget includes significant increases in allocations for wages and salaries, as well as measures to boost revenue collection.
Total revenue and grants have been revised upwards from K4.55 trillion to K4.63 trillion. Total expenditure has been revised upwards by K41.5 billion from K5.99 trillion to K6.04 trillion.
Domestic revenue is expected to increase marginally by 0.1 per cent from K3.38 trillion to K3.39 trillion. Grants are projected to increase by K72 billion from K1.17 trillion to K1.24 trillion, representing a 6.2 per cent increase.
The government has also introduced several revenue enhancement measures, including the removal of Value Added Tax (VAT) waiver on motor vehicle imports for privileged individuals. This measure is expected to affect individuals such as the State President, Cabinet Ministers, and Members of Parliament.
“The budget has seen some cuts because we want to live within our means and expand the revenue base to ensure we carry out all Government services,” said Minister Chithyola Banda.
Other revenue enhancement measures include the full implementation of electronic excise tax stamps, opening a voluntary tax compliance window for motorcycle operators, and expanding electronic payments across revenue-collecting entities.
The revised budget also includes significant increases in allocations for wages and salaries, with a revision upwards of K201.2 billion from K1.08 trillion to K1.28 trillion, representing an 18.7 per cent increase. Interest payments on debt have been maintained at K1.46 trillion, while goods and services have been revised upwards to K931.4 billion, representing a 10.2 per cent increase.
“We firmly believe that these initiatives will decisively tackle smuggling and tax evasion,” added Minister Chithyola Banda.
The Minister emphasized the need for a collective effort to support the revised budget and revenue enhancement measures for the benefit of the nation.
