TRA: Scrap tax relief on commercial goods

Tanzania Revenue Authority (TRA) board chairman Bernard Mchomvu has urged the government tosuspend tax exemptions on commercial goods such as rice and sugar, saying they were not helping consumers but rather causing the government revenue losses.

He made the remarks at the 6th Taxpayer Day celebrations in Dar es Salaam yesterday. “Our research shows that exemptions on business goods such as foodstuff are not helping consumers; rather they reducing tax collection,” he said.

The chairman said millions of shillings are lost each month as a result of tax exemption on rice and sugar.

“We can offer exemptions on religious aid and aid from our development partners, but tax exemption on business goods should be removed,” insisted Mchomvu.

Finance minister Dr William Mgimwa, who was at the function, hailed TRA for doing a good job, saying the authority had improved efficiency in strategic tax collection.

He observed that TRA had surpassed monthly tax collection targets, reaching an average of 754bn/- in 2012 compared to 42bn/- at the launch of the strategic plan in 1998/1999-2002/2003.

“This year’s tax collections are satisfactory. Even reports from Zanzibar indicate a slight improvement following TRA’s implementation of its set strategic tax collection methods,” he said.

Dr Mgimwa hinted at the likelihood of the government introducing strategic plan number four, while noting that number three, which focuses on the use of science and technology in collecting tax had proved useful.

For his part, Vice-President Dr Mohammed Gharib Bilal said the government’s five-year development plan launched in June last year by the president aimed to increase production and the availability of power to enable economic and development activities to be implemented more efficiently.

He however told the Authority that the government was targeting a 19 per cent increase in revenue collection, challenging, TRA to come up with strategies and plans to ensure positive results.

“Since it is your responsibility as a revenue authority to monitor taxes, you should make sure that you fulfill your duties diligently by providing good services to taxpayers,” he urged
.

He observed that TRA had surpassed monthly tax collection targets, reaching an average of 754bn/- in 2012 compared to 42bn/- at the launch of the strategic plan in 1998/1999-2002/2003.

“This year’s tax collections are satisfactory. Even reports from Zanzibar indicate a slight improvement following TRA’s implementation of its set strategic tax collection methods,” he said.

Dr Mgimwa hinted at the likelihood of the government introducing strategic plan number four, while noting that number three, which focuses on the use of science and technology in collecting tax had proved useful.

For his part, Vice-President Dr Mohammed Gharib Bilal said the government’s five-year development plan launched in June last year by the president aimed to increase production and the availability of power to enable economic and development activities to be implemented more efficiently.

He however told the Authority that the government was targeting a 19 per cent increase in revenue collection, challenging, TRA to come up with strategies and plans to ensure positive results.