Zambia, Malawi sign tax deal
By Jeff Kapembwa
LUSAKA – Zambia and Malawi have resolved to harmonise trade barriers that affect trade between the two neighbours through the signing of the Double Taxation Avoidance Agreement (DTAA).
The DTAA, also referred to as a Tax Treaty, is a bilateral economic agreement between the two nations that aims to avoid or eliminate double taxation of income.
The signing of the agreement between them entails those traders crossing the borders will no longer be forced to pay twice for the same goods imported from either of the countries as it abrogates and stifles economic growth of the two countries while at the same time disadvantages the people prying their trade.
During a two-day 15th Joint Permanent Commission (JPC) meeting held in Lusaka last week, Zambia’s minister of Foreign Affairs Harry Kalaba noted that some of the major hindrances to trade have been resolved through the DTAA signing, which he said will bolster trade and investment between the two neighbours.
Other agreements signed and harmonised during the JPC include immigration, local government, tourism, agriculture, livestock, labour and employment, health, science and technology.
Kalaba has since urged the two sides to embrace and ensure the instruments are upheld to better the economies of the two countries..
“I wish to urge our two sides to remain focused and realise the implementation of these instruments to ensure benefits trickle down to the people at the grass-roots level,” Kalaba said during the meeting aimed to advance common interests and aspirations for the benefit of the two countries.
“It is gratifying that during deliberations of the JPC”, Kalaba stated, adding that “the two countries set targets and time frames for executing decisions of the commission. During the meeting a mid-term review follow-up mechanism was set up to monitor and evaluate progress in the implementation of agreed areas of cooperation”.
On his part, Malawian Foreign Affairs Minister Francis Kasaila said the ratification of the DTAA will ensure investors are not taxed twice on the same income and it will further enhance investment between his country and Zambia.
He said the new accord will lead to reduction in the cost of doing business in various sectors.
On the Simplified Trade Agreement (STR) Kasaila added that it was good that the two countries had made headway in resolving the matter noting that since it was launched, trade between Malawi and Zambia have continued to grow, especially for small-scale traders.
Ministers Kalaba and Kasaaila have called on the private sector to exploit trade investment opportunities in Malawi and Zambia.
“It is through trade that we can make our people become economically empowered and improve their living standards,” added Kasaila.
The STR initiated in 2013, is an initiative is intended to help small-scale traders benefit from the preferential rates enjoyed by commercial traders when importing or exporting goods within member states.
The regime is operational between Zimbabwe and Zambia, and Zimbabwe and Malawi. Mozambique and Zambia also have a JPC and trade between the two countries does flourish but they are yet to sign a tax treaty.