Title: Malawi’s Value-Added Tax (VAT) Fraud Probe: Several Billions in Alleged Lost Revenues, Arrests Expected
Malawi’s tax authority, the Malawi Revenue Authority (MRA), in collaboration with the Malawi Police Fiscal Department, is currently investigating a substantial Value-Added Tax (VAT) fraud case worth several billion kwachas. The alleged fraud has involved insiders, including MRA officials and certain NGOs, using forged tax exemption certificates to claim taxpayer funds inappropriately.
Alleged VAT Fraud Scheme
The fraud scheme allegedly entailed the submission of false VAT payments by these organizations, granting them VAT refunds. Some of the implicated NGOs reportedly have members who were detained last week following police apprehensions.
- Identities concealed: A senior official from the MRA’s Lilongwe Division and other MRA officials involved in the scandal have had their identities withheld for legal reasons, while the roles of other implicated individuals remain undisclosed at this time.
- Admitted ongoing probe: MRA Corporate Affairs Manager, Steven Kapoloma, confirmed the ongoing investigation in a written statement to the Platform for Investigative Journalism (PIJ):
“The Malawi Revenue Authority (MRA) is working with the Fiscal and Fraud Unit of the Malawi Police Service to investigate allegations of value-added tax (VAT) fraud claims made by some NGOs. The investigations are progressing well, and some arrests have been made involving both people within and outside MRA. They have been charged with fraud and money laundering. The investigations are still ongoing, and further details will be provided once the investigations are complete.”
- Police confirmation: Deputy Police Spokesperson, Alfred Chimthere, also confirmed the ongoing investigation and the connection to last week’s arrests: “The investigation is ongoing, but I need to cross-check information on its progress with my colleagues from the Fiscal Department.”
MRA’s Commitment to Combating Tax Evasion
This investigation demonstrates MRA’s commitment to addressing tax evasion, as they have adopted new technologies and launched public awareness campaigns. According to the authorities, the probe represents a significant achievement in the detection and prevention of high-profile VAT fraud involving MRA employees.
As the investigation continues, PIJ will provide updates on this developing story.
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