CAMA Executive Director John Kapito told us Sunday morning that for instance, the budget lacks direction on how revenue will be generated to achieve the stated plans adding that it has frustrated Malawians' expectations of the Farm Input Subsidy Program among others.
“The issues to do with the free connection of electricity and water, universal fertilizer subsidy, cheap passports and licenses for instance. In the absence of what I said earlier on, where does the government generate the revenue put in that budget? Worse still the government has imposed taxes on certain goods and services. Is that not empty?”
Kapito has also decried the imposition of taxes on commodities such as refined cooking oil which he says is a necessity that will largely affect small businesses.
Economic Lecturer from the Catholic University Hopekins Kawaye concurs with Kapitos reaction to the budget saying for instance “imposing a tax on refined cooking oil will likely hike prices for most commodities which will, in the long run, affect a larger population.”
He adds that the country’s borrowing does not match expenditure where he says the government spends more than its resource envelope.
“As we stand now the debt is at 4.1 trillion kwacha and if we look at the budget we will have to borrow about 570+ billion kwacha to add to the 4.1 trillion kwacha debt,” explains Kawaye.
He however feels “the revised tax bracket of 45,000 to 100,000 will likely cushion this as it will allow people to have more money in their pockets for better lives,” says Kawaye.
Meanwhile, Government spokesperson Gospel Kazako has asked for calm and patience among the citizenry saying government has everything under control.
“We cannot do everything in 6 months. This is why every government is given a 5-year term. We have already started offloading some of the promises we made and much more is coming. They should not make people panic as if we said we will not do it. We believe in what we promised and we are going to deliver,” says Kazako.
Minister of Finance Felix Mlusu presented in parliament the 2020/21 maiden budget pegged at 2.19 trillion kwacha Friday last week.
