Government revenue jumps 106 percent in July

Government revenue jumped by 106 percent in July to hit K516.2 billion from K250.4 billion in June, figures from the Reserve Bank of Malawi (RBM) show.

The K265 billion revenue rise in July 2024 was driven by a K150.8 billion (76.0 percent) increase in tax revenues, a K4.7 billion (69.2 percent) increase in non-tax revenues and a K110.3 billion rise in grant collections.

On the other hand, expenditures quickened to K502.4 billion in July 2024 from K359.3 billion in the preceding month, on account of both recurrent and development expenditures.

RBM says, specifically, recurrent expenditures increased by K71.3 billion (25.1 percent) while development expenditures rose by K71.9 billion (95.8 percent) to K355.6 billion and K146.8 billion during the period under review.

In an interview on Friday, Finance Minister Simplex Chithyola Banda said authorities have intensified revenue collection, both from tax revenue and not tax revenue bases, hence the rise in government revenue.

“This is a positive development because it indicates that our efforts are now paying dividends. However we have a sharp rise in expenditure because of the social obligations that we are mandated to do for this country to run. You talk of fuel, medical supplies and other essential services,” Chithyola Banda said.

He said the Treasury is working towards balancing up by strictly enforcing expenditure controls under austerity measures.

“We thank the Malawi Revenue Authority for good work done but also some MDAs who are adhering to austerity measures compliance. We are slowly moving in the right direction,” Chithyola Banda said.

In the 2024-25 national budget, authorities have estimated total revenue and grants at K4.55 trillion of which tax revenues are estimated at K3.26 trillion while nontax revenues have been projected at K126.54 billion.

The budget also estimated grants at K1.17 trillion, of which K1.10 trillion will come from international organisations and K72.69 billion from foreign governments.

Total expenditure for the financial year, on the other hand, is programmed at K5.98 trillion.

The budget has a deficit of K1.43 trillion, which is to be financed through domestic borrowing amounting to K1.28 trillion and K150 billion foreign borrowing.