BY ISHMAEL CHIMWAZA
Noel Lipipa, a Member of Parliament for Blantyre South representing the Democratic Progressive Party (DPP), has raised concerns regarding the Malawi national budget for 2024/2025. The budget, presented by Finance Minister Simplex Chithyola on February 23rd, is outlined at 5.98 trillion Kwacha for expenditures, equivalent to 32% of the GDP, and 4.5 trillion Kwacha for revenue and grants, constituting 25% of the GDP. This creates a significant budget deficit of 1.4 trillion Kwacha, which amounts to 7.6% of the GDP.
NOWEL LIPIPA (MEMBER OF PARLIAMENT FOR BLANTYRE SOUTH)
In response to the budget on March 19th, 2024, Lipipa criticized the assumption that the Malawi Revenue Authority (MRA) would successfully meet the revenue collection target to fund the budget, given the current economic challenges. He highlighted that the budget projects MRA to collect K3.3 trillion, which he deemed unrealistic considering the private sector's struggles due to high-interest rates and forex shortages, labeling it as merely an assumption.
Lipipa further warned that if MRA fails to meet the targeted 2.2 trillion Kwacha in the 2023/24 budget, it could result in delayed salaries, budget cuts, and budget imbalances. He also noted the impact of the non-tax wage bracket increase, appreciating the move but cautioning that it could reduce revenue collection by 20 billion Kwacha.
The Blantyre South MP urged the finance minister to prioritize crucial issues like stagnant domestic revenue, increasing pension bills, and challenges in salary payments. Lipipa proposed various solutions, including limiting domestic borrowing, reducing domestic travel expenses, and effectively managing forex by promoting import substitution, enhancing exports, and boosting tourism.
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