Low VAT collection rate makes it Mozambique’s Tax of the Year

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Low VAT collection rate makes it Mozambique’s Tax of the Year

12:02 CAT | 16 Mar 2016

A Bola

The Mozambique Tax Authority is concerned about low value added tax (VAT) collection rates, and hopes to boost them by making it Tax of the Year for this financial year

The situation was outlined on Tuesday by former deputy general director of taxes Orlanda Manhique in a lecture in Maputo.

Manhique says that the collection of VAT in the country is still poor, despite taxpayer awareness campaigns pointing out that that the weak recovery compromises government expenditure.

VAT contributes 35 percent of state revenue and any shortfall in its collection undermines state expenditure. The state expects to raise 137 billion meticais from VAT In 2016 but so far has managed to collect only 14 percent of that figure.

President of the Tax Authority Amelia says that paying taxes plays an extremely important role in the achievement of the government’s goals, and has determined March 22nd, the date of the Tax Authority’s creation, as Taxpayer Day.

The choice of VAT as Tax of the Year is due to the fact that it significantly affects the collection of other taxes, and the efficiency of its collection has a positive impact on state revenues, Nakhare said.

Source: A Bola