Skip to main content

Taxation: Malawi

Question for HM Treasury

UIN HL8255, tabled on 9 May 2016

To ask Her Majesty’s Government what assessment they have made of whether the renegotiated tax treaty between the UK and Malawi will improve opportunities for the government of Malawi to raise domestic revenue.

Answered on

12 May 2016

Discussions with Malawi over a new tax treaty began some years ago, and substantive agreement has been reached at official level. The Government of Malawi have stated that they hope to be in a position to sign the new treaty in the near future.

The current negotiations are a matter for the two governments. The UK’s starting point in negotiations is based closely on the OECD Model Double Taxation Convention, which is also the basis for most other countries’ tax treaties. Some developing countries prefer to follow the UN Model, the provisions of which differ in some areas to the OECD Model. The UK does adopt these provisions in its treaties where agreement is reached.

This is a matter for the Government of Malawi. However, they have stated that there is no evidence that the current 1955 agreement has motivated British investors to deprive the Government of Malawi of its revenues.

The terms of tax treaties are for the negotiators of both countries to agree. Only when both governments are content with the terms of the treaty will the treaty be signed. It would be inappropriate for draft treaties to be published in advance of signature to the treaty.

In the UK tax treaties are published and subject to parliamentary scrutiny before they become law and enter into force. A form of approval is usually followed in the corresponding country, thus giving a further level of assurance that the terms are acceptable to both Governments.

Answered by