By Iommie Chiwalo

LILONGWE-(MaraviPost)-The country’s civil rights body, the Centre for Democracy and Economic Development Initiatives (CDEDI) has spoken tough against punitive taxes and has since given the Chakwera-led Tonse alliance administration seven days notice to address the same.

Addressing the news conference with farmers on Saturday, April 3, 2021 in the capital Lilongwe, CDEDI Executive Director Sylvester Namiwa reiterates its stand against punitive tax regimes that end up punishing the vulnerable and the marginalized Malawians who are in majority in the country.

Namiwa therefore gave the Tonse Alliance Government seven days to scrap off VAT on cooking oil, and find other means of generating revenue from the local manufacturers; commence a review of its tax regime in order to revise all the taxes that are chocking the local industry and hitting hard on the ordinary Malawians, 80 percent of whom are living in rural areas and depend on subsistence farming.

“Should this demand land on deaf ears, which is mostly the case with the current Tonse Alliance administration, then CDEDI will be left with no choice but to mobilize all Malawians of good will to hold nationwide demonstrations, until such demands are adhered to.

Namiwa says is sad to note Tonse Alliance government’s continued disregard for the poor people in the country, by among other things, introducing tax regimes that have ended up punishing the poor people through loss of jobs; increase of prices for basic goods and services.

He says a recent example is the introduction of 16.5% Value Added Tax (VAT) on cooking oil, a
development that has pushed up the cost of living, and has turned most poor people into scavengers.

‘Today, an average Malawian cannot afford to buy the locally produced cooking oil since the prices have sky-rocketed, with a price adjustment of almost 100%. It is for this reason that CDEDI is challenging all Malawians of good will to join a crusade to force the Tonse Alliance Government, under President Dr. Lazarus Chakwera to start championing pro-poor policies in order to protect the marginalized from hazardous smuggled edible oils that have flooded the local
market,” he says.

Namiwa further elaborates that CDEDI has been forced to take this route, after it has realized that government
has shut the door on the poor people, if the admission by the Director of Revenue in the Ministry of Finance Kenneth Matupa is anything to go by.

“In a virtual meeting that was held recently between CDEDI and the ministry,Matupa made it very clear that the ministry was aware that the introduction of VAT on cooking oil has pushed up the prices of cooking oil on the local market, and that this has in turn opened up a market for smuggled oil products, whose safety nobody can guarantee,” he says

Adding that Mr. Matupa further admitted that there are lapses to contain smuggling in general, not only on cooking oil, but on various products because, as he put it, the malpractice is being
perpetuated in most cases by the influx of foreign nationals that are living in Malawi illegally, doing illegal business in undesignated premises.

On a sad note, the CDEDI Executive Director disclose that a recent study by the Mangochi District Health Office on food fortification revealed that most people are consuming foods that do not contain the required mineral and vitamins, by indicating that out of the eight cooking oil samples which were scrutinized, only one contained the required Vitamin A.

“Having analyzed the outcome of the meeting, CDEDI has come to believe that there is either general neglect of duties by some officers in the law enforcement agencies responsible for containing the influx of both illegal goods and
immigrants into the country, or the Tonse Alliance administration is deliberately introducing the punitive tax regimes in order to suffocate the local industry in an attempt to bring in their own preferred business interests,” Namiwa says while stressing that the latter can be true, looking at the recent closure of private companies such as the Kanengo Tobacco Processors Limited in Lilongwe, and the announcement by Bakhresa Group of Companies that they are closing their soap making plant in Mzuzu.

“It appears the plan by the Tonse administration is working out perfectly well, since no government official, not even the responsible ministers for Trade and Industry, has come out to make a statement on this very sad development about the closure of companies in the country. As an advocacy institution on human rights, CDEDI has come in to stand with the voiceless, and we are demanding government to scrap off VAT on cooking oil, which has ended up making the poor people even more miserable, and has posed a great threat to the survival of the local industry which besides creating jobs, is also bringing in the much-needed foreign exchange through the sale of the soya cake, a byproduct of cooking oil from soya beans,” he says.

The CDEDI Chief also highlighted that the current lapses need urgent attention as they have a negative bearing on economic front.

He says, for records sake, from such exports, the country realizes a minimum of US$60 million annually,
and the industry is providing permanent employment to 1, 600 people and 800 casual labourers.

“If the Tonse Alliance administration is really serious about uplifting the livelihood of poor Malawians, then let them start implementing policies that really resonate well with the local people, such as scrapping off the 16.5% VAT in cooking oil; a product that is commonly and mostly used by the local people in the villages for small scale businesses such as making mandasi, locally made cakes, kanyenya,”

Wilfred Dula, Mchinji farmer from Traditional Authority (T.A) Zulu echoed with Namiwa of Chakwera’s leadership insensitive over Malawians needs.

Dula worried with introduction of 3% holding tax on agriculture produces arguing that it is uncalled to already stricken farmers.