Malawi Plans to Raise VAT Rate to 17.5 Percent

Lilongwe, December 3, 2025 – The government of Malawi announced plans to increase the VAT (Value Added Tax) rate from 16.5 % to 17.5 %. The proposal was presented in the first‑semester budget report for FY 2025/2026.

Finance Minister Joseph Mwanamvekha said the hike aims to improve revenue mobilization and stabilize fiscal space, noting that neighboring countries such as Morocco and Madagascar levy 20 % and Tanzania 18 %. The change still requires parliamentary debate to amend the VAT law.

Industry and consumer groups warned that the increase could raise prices of everyday items like cooking oil, sugar, soap and transport, potentially adding pressure to household budgets.