Africa-Press – Mozambique. The Confederation of Mozambican Business Associations (CTA) has discussed with the International Monetary Fund (IMF) the harmonization of tax obligations for national businesses as a measure to reduce public debt.
According to, CTA Deputy Executive Director Eduardo Macuácua, who was speaking to reporters on Thursday, after IMF representative Olamide Harrison, visited the organization’s headquarters in Maputo, macroeconomic issues were addressed.
“As we know, the IMF is working with our government to reduce the growing public debt and the fiscal deficit, because what we collect as revenue is below the level of public expenditure”, he said.
According to Macuácua, revenue collected is about 27 per cent of Gross Domestic Product (GDP), while public expenditure, in contrast, is around 34 per cent. “Therefore, the IMF is proposing reducing public expenditure to bridge the imbalance between low revenue and high expenditure”, he said.
“What happens is that a small portion of the formal economy, representing about 20 to 30 per cent, pays taxes; but the informal sector, which makes up the majority of the economy, has not contributed much in the way of taxes”, he said.
Macuácua believes that the government must implement further reforms to facilitate business registration and, thus, contribute to tax payments.
Macuácua also considers it appropriate to reflect on and evaluate the benefits granted to some foreign investments that received exemptions in order to contribute to increasing public revenue.
“To this end, the IMF shared the experience of other countries that have faced similar challenges in the past”, he said.
He also said that during the meeting, the CTA invited the IMF to participate in the 20th Annual Private Sector Conference (CASP), which will take place from 12 to 14 November.
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