The High Court has opened the way for a legal challenge to Malawi Revenue Authority’s (MRA) new Electronic Invoicing System (EIS), granting businessman Upson Mkandawire permission to proceed with judicial review proceedings.
Mkandawire is challenging the Value Added Tax (Electronic Invoicing System) Regulations, 2026, and MRA’s decision to roll out the system and phase out Electronic Fiscal Devices (EFDs).
The EIS is the new electronic tax invoicing system introduced under amendments to the Value Added Tax Act. It is intended to enable MRA to receive, store and monitor information on business sales transactions for purposes of enforcing VAT compliance.
The system replaces EFDs, which had been used for about 12 years to transmit and monitor sales information.
The court said the regulations initially set February 1, 2026 as the commencement date, but implementation was later moved to May 1 following concerns raised by the business community.
Mkandawire argues that the regulations were introduced without adequate consultation with businesses and other stakeholders.
He has also challenged the collection and processing of personal and commercial data through the EIS, arguing that data protection requirements were not adequately considered.
The government and MRA opposed the application, arguing that Mkandawire did not have sufficient interest in the matter and had not exhausted alternative legal remedies.
But Justice Chimbizgani Matapa Kacheche rejected the objections, saying VAT-registered businesses could be directly affected by the regulations.
“The claimant and any individual VAT registered business person has sufficient interest,” the judge ruled.
The court also found that the case raises disputed issues of fact and law that require a full hearing.
“I therefore grant permission to proceed to Judicial review,” Justice Kacheche said.
However, the court refused to stop implementation of the EIS, noting that the system had already been implemented by the time the application was heard.
Justice Kacheche said the balance of convenience favoured refusing the injunction, noting that stopping MRA from collecting relevant data from hundreds of VAT-registered businesses could make potential losses difficult to quantify.
