A statement issued by the tax collecting body and signed by Steven Kapoloma Head of Corporate Affairs at MRA, said Yuan Chenggang, a sales representative of Herocean Enterprises was apprehended on suspicion of selling iron sheets without charging VAT.
The arrest was triggered by a search exercise conducted at the company's business premises where MRA also seized various company documents.
“The documents indicate that VAT was not charged on certain sales resulting in the evasion of K580.9 million,” declares the statement.
The statement further states that Jiang Peng, a sales representative of United Manufacturing Company Limited in Blantyre was also separately arrested on suspicion of selling motor vehicle batteries without charging VAT, evading K45 million in the process.
“The two acted contrary to provisions of the Value Added Tax Act,” reads the statement in part.
The operation followed a tip from well-wishers who alleged that the two companies sell iron sheets and motor vehicle batteries, respectively, without charging VAT.
The suspects are currently at Blantyre Police Station as the Authority conducts further investigations.
If found guilty, the two will be required to pay the whole amount of evaded VAT and extra fines imposed by MRA.