Tax authority wants 23 per cent increase in revenue

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Tax authority wants 23 per cent increase in revenue

6:51 CAT | 16 Oct 2017

The Mozambican tax authority (AT) hopes to collect 23 per cent more revenue in 2018 than the target for this year set in the state budget.

Speaking in Maputo on Friday, at the close of an AT national planning meeting, the chairperson of the AT, Amelia Nakhare, declared that next year minimum revenue of 222.8 billion meticais (about 3.65 billion US dollars, at current exchange rates) should be collected. This year’s revenue target is 186.33 billion meticais.

Since the forecast for economic growth next year is just 5.3 per cent, and since the government has ruled out increasing tax rates, the only methods by which the AT can increase revenue by such a large sum are dramatic reductions in tax evasion, and bringing more people into the tax net.

The informal sector accounts for a large slice of the Mozambican economy and is largely untaxed. Promises to expand the tax base are made regularly, so far to little effect.

Cited in Monday’s issue of the Maputo daily “Noticias”, Nakhare urged all tax officials to fight a relentless battle against corruption. Mozambique’s borders, she said, “should not be a stage for corruption and illicit acts which call into question national stability”.

“Tax justice and transparency mean that we must be implacable in compliance with the law”, she said. “We must reduce as far as possible the discretionary power of each functionary of our institution”.

Nakhare called for increased inspection of those companies which enjoy special tax regimes, rationalisation of fiscal benefits, and greater control mechanisms through the use of fiscal stamps on alcoholic drinks and tobacco products, and a marker system for fuel.

To combat contraband in liquid fuels, she added, negotiations were under way with the company that won the tender for importing fuels, in order to ensure effective marking of fuel as from early 2018.

The adding of markers to fuel, which cannot be imitated or removed, makes it possible to detect not only smuggling, but also dilution and adulteration of fuel.

“Attaining the targets we are proposing will be a great challenge for us”, admitted Nakhare, “and I am exhorting all of us to surpass the targets, because the development of the country depends on the commitment of each of us”.

Source: AIM