Malawi Congress of Trade Union demands K30, 000 tax threshold


The Malawi Congress of Trade Union (MCTU) is demanding that government must increase the zero percent threshold for the Pay As You Earn (PAYE) from the proposed K20,000 to K30,000.

In his K638.2 billion budget Finance Minister Ken Lipenga proposed an increase of the zero per cent threshold for PAYE from K15,000 to K20,000.

But MCTU Secretary General Pontius Kalichero suggested that the zero percent threshold should be increased further to K30,000 because this is the wage for the lowest-paid civil servant.

“A consideration should also have been made to even reduce the percentage from 30 to 20 per cent for the next K5, 000,” he said. “This could reduce the burden of the already poorly paid workers to have a higher take-home pay.”

Kalichero said this should have been supplemented by an increase in basic salaries for civil servants as earlier agreed. He said the impact of the devaluation and its inflationary effects are still being felt in the economy and this is affecting the welfare of people.

Many commentators have faulted allocations in the budget which they say favour the few at the pinnacle of power. An estimated K10.2 billion will be used by the presidency, the Office of President and Cabinet.

MCTU says the selection of which sectors to prioritise is very crucial if the budget is to be effective.

“With the implementation of the national decent work agenda in Malawi, the budget should have highlighted meaningful implementation strategies which have been put in place to achieve this,” he said.

Kalichero said the agenda – which has been set up to harmonise salaries and working conditions in the civil service – is a vital tool for the country in terms of uplifting people from poverty.
“Another crucial area is labour inspections and recruitment of human resource to close gaps in the civil service,” he said.

Labour inspection is central to the problems of workers health and safety, and to the problems of many children of school-age working under disastrous and inhumane conditions,” he said.

In her state of the nation address in Parliament, Kalichero said, President Joyce Banda spoke about the importance of social dialogue with partners.

“In support to this, MCTU feels that it would have been appropriate if the 2013/14 budget had catered for tripartite social dialogue meetings which used to take place between government, employers and workers,” he said.

“It is at these meetings where consultations on such issues as the South Korea/Dubai labour export could have been tabled rather than hearing reports in newspapers,” he added. – By Gregory Gondwe

Picture – Lipenga presented budget

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