29th January 2007, 03:41 PM
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Halisi
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Naamini hii story inaweza kutoa mwanga wa nini alichosema Lunyungu
Govt posts huge tax exemptions and …
- MPs are not amused
- Exemptions equal EU budget support
- They are also equal to our budget deficit
SAYUNI KIMARO
Dar es Salaam
THE government has reportedly doled out a staggering 480bn/- in tax exemptions within the past six months – and Parliament isn’t amused, THISDAY can report.
The exemptions are said to cover the six months ending December, 2006, according to sources within the Parliamentary Committee for Finance and Economic Affairs.
The sources intimate that the legislators are now demanding a detailed report on the exemptions after the Ministry of Finance presented its report to the committee on Thursday – which they reject as inadequate.
The document submitted to the committee revealed that between July and December last year, the Tanzania Revenue Authority exempted taxes totalling 475,244.9m/- on the Mainland and 7,892.7m/- in Zanzibar – where the Isles investment promotion agency (ZIPA) got the bulk of the exemptions at 20.8 per cent, surpassed only by government institutions which got 44.2 per cent.
“We demanded explanations because the amount involved was big enough to cover our budget deficit, and cut our dependence on donors. That’s why we called for more explanation from the government,” a committee member said.
The parliamentarian said the cash dished out through exemptions is equal to what the country got from the European Development Fund as budget support last year -- 500bn/-.
According to the Treasury report, the beneficiaries of the exemptions, which included customs and domestic taxes in the Mainland were: Tanzania Investment Centre (88.26bn/- or 18.6 per cent); private companies and individuals (73.3bn/- or 15 per cent); donor funded projects (21.35bn/- or 4.5 per cent); and government institutions (13.92bn/- or 2.9 per cent).
Others were religious institutions and NGOs (11.4bn/ or 2.4 per cent), parastatal companies (9.54bn/- or 2 per cent); and regional cooperation agreements (2.31bn/- or 0.5 per cent).
In Zanzibar, other exemptions also went to private companies (1.55bn/- or 19.6 per cent); parastatals (1bn/- or 12.7 per cent); religious institutions and NGOs (211m/- or 2.7 per cent).
On domestic taxation, there was a “special” tax waver of 217bn/- or 45.8 per cent – which went to duty-free shops (1,57bn/- or 0.3 per cent) and a category code-named “zero rated” exemptions which amounted to 35bn/- or 7.5 per cent, the Treasury report shows.
Over the same period, actual collections from the Tanzania Revenue Authority amounted to 559,237.7m/-, but the tax exemption set through Customs department tally at 220,118.4m/-, or 39 per cent of the collections.
In the meantime, internal revenue collections on the Mainland amounted to 305,220.9m/-. But here, the exemptions surpassed collections by 84 per cent, or 255,126.6m/- in real figures. Actual collections in the Isles over the same period stood at 9,615.0m/-, but here, too, much of the money (82% ) went to cover tax exemptions, which stood at 7,892.7m/-.
In 2006/7 Zanzibar collected 14,514.5m/- in revenues compared to the estimated amount of 13,344m/-, a nine-per cent improvement over its own estimates. Actual collections stood at 3,896.4m/- (internal revenues) equivalent to 102 per cent. In Customs taxes the estimated collection was 11,547.8m/- but actual collections were 6,766.4m/-, equivalent to 59 per cent.
In 2006/7 the government planned to accumulate 5,078.5m/- and the actual collections were 4,899.6m/- equivalent to 97 per cent of projected internal revenues. The Customs had set a target of an amount of 8,265.5m/-, and collected 9,614m/-, equivalent to 116 per cent.
The Mainland had set targets of 172,497.2m/- in internal revenues but actual collections came to 177, 261.3m/- or 103 per cent. There was also a target of 362,116.7m/- for the “big” tax payers, but actual collections fell 3% shy of projections: 364,748.0m/- was collected. There was a similar shortfall of collections against projections for the Customs Department.
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