The Malawi Revenue Authority has refunded more than 9.4 billion kwacha in withholding tax to tobacco farmers since 2021.
Previously, tobacco farmers faced a 3 percent refundable withholding tax deduction at auction floors when selling tobacco.
However, due to various challenges, the process of receiving the refund was delayed, causing frustration among farmers.
In an interview with MIJ Online, Janet Kholowa, Deputy Commissioner of Lilongwe Domestic Taxes for the Malawi Revenue Authority, disclosed that to date, fourteen thousand eight hundred tobacco clubs, each comprising ten members, have been compensated.
She added that the new tax measures for the 2022/23 period have brought relief to small-scale tobacco farmers, as the withholding tax has been reduced from 3 percent to a nonrefundable 1 percent final tax.
In the meantime Lyson Banda, chairperson of tobacco farmers in the central region, has appreciated the Malawi Revenue Authority’s efforts in facilitating tax reimbursements to the farmers.