Ministry of Finance, Parliamentary Committee on Natural Resources and Climate Change differ on Carbon Levy

The Ministry of Finance has shot down Parliamentary Committee on Natural Resources Climate Change’s demand to remit 100 percent funds collected through Carbon tax Levy to Ministry of Natural Resources and Climate Change for mitigation of climate change effects.

Speaking during an interface meeting on the utilization of Carbon Levy between the Ministry of Finance, Parliamentary Committee on Natural Resources and Climate Change, and non-state actors Wednesday evening in Lilongwe, Budget Director Loyce Chilinsungwi told the meeting that the ministry has planned to allocate 1 billion Kwacha against MK2.5 billion which the natural resources ministry budgeted for, starting with MK500 million in the current budget deliberations.

But reacting to the Ministry of Finance’s stand, Parliamentary Committee on Natural Resources and Climate Change Chairperson Wellanie Chilenga said the committee will not relent it’s efforts until the ministry of finance complies to the 100% remittance.

Chilenga said it is unreasonable for the ministry to allocate MK500 million only as the Levy is only meant for mitigation of climate change effects, and not strengthening tax base.

“It is not a matter for them to be deciding. It will be very unfair for someone just to decide that that money should be aportioned in small amounts to the Ministry of Natural Resources and Climate Change. We have always been discussing with former Finance Minister that this money has to be remited 100 percent. So we don’t know why there is a change on that.

Chilenga: we will not stop until ministry of finance remits 100 percent of the funds for climate change effects mitigation

“It is not their money. As an oversight committee on issues to do with natural resources and climate change, we are not going to put our foot down and make sure that the ministry complies,” Chilenga said.

Speaking on behalf of non-state actors, Civil Society Network on Climate Change (CISONECC) 1 Coordinator Julius Ng’oma described the discussions as candid, saying the Ministry of Finance showed thier honesty on how they perceive the carbon levy issue.

Ng'oma: the discussions were fruitful

However, Ng’oma said the non-state actors are not convinced with Ministry of Finance’s decision to remit MK500 million to mitigation of climate change effects in the country.

“Whatever discussion they will have as Ministry of Finance, they will still have to consider remiting more than MK1 billion and above at least for a start, the rest can be remited in phases,” he said.

Established in November 2019, carbon levy was introduced to support climate change management in the country, but since it’s establishment, government is yet to remit a single penny for mitigation of climate change effects.