The report recommends the government improve tax e-filing and provide ‘nudges’ for firms to pay their taxes across Malawi. The MRA has already begun planning for this intervention, and this report provides economic evidence that the benefits of implementation exceeds cost by a factor of 7. The intervention would reduce the tax compliance costs of MSMEs by 65% – saving compliant businesses a total of MWK 5,271 million per year in the long run. The MRA would also see savings of MWK 2,570 million annually. The intervention requires an upfront expense of MWK 1,082 million for the ICT improvements, and ongoing costs of MWK 840 million for operating the system and MWK 57 million for tax nudges.
A Cost-Benefit Analysis of Government Services to Support MSMEs in Malawi - Technical Report
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