Topic: Accusations against mobile phone companies shocking

Accusations against mobile phone companies shocking

By Editor

9th June 2012

The revelation last week by Communications, Science and Technology deputy minister January Makamba, in his article published by our sister newspaper, The Guardian on Sunday, as a commentary on an opinion published two weeks ago, is both shocking and appalling.

The minister, in his article, claimed to have authentic and reliable data from the regulator, Tanzania Communications Regulatory Authority (TCRA), to back his claims that mobile phone companies have been evading paying taxes for some years now—thanks to a lack of technology to detect their actual revenues.

According to the minister, in the year 2010 mobile phone companies in Tanzania earned $1 billion (Sh1.6trillion), but paid only $1.7 million (Sh2.7 billion) in taxes. But, during the same period, Kenya earned $78.3 million from mobile phone companies, Uganda made $31.3 million while Rwanda collected $14 million nearly ten times what the Tanzania government earned.

If this is the situation, then the public has the right to know why mobile phone service providers are shortchanging the government in paying tax while making trillions of shillings? One would rightly go further and demand to know what measures the government and the Tanzania Revenue Authority have taken to recover the unpaid taxes.

Cellphone service firms are supposed to pay Value Added Tax (VAT) and Corporation Tax for those which have made a profit, plus other taxes as stipulated by the country’s laws. It’s therefore appalling to note that Kenya collected fifty times what Tanzania did from mobile phone companies as taxes in 2010.

As the deputy minister put it, “Surely, you could argue that Kenya’s economy is bigger than ours, but Rwanda - a much smaller economy compared to ours and with only two mobile companies - collected more than what Tanzania earned.”

When you consider that the total number of mobile phone subscribers in Tanzania is far bigger than the population of Rwanda, which has about 11.5 million people, it is an insult to our intelligence to make us believe the country could collect more taxes from the mobile phone service subsector than we did.

It is estimated that Tanzania has about 15 million mobile phone subscribers, though some statistics show that the number could actually be closer to 20 million.

This, coupled with the fact that there are seven (not two) telecom companies operating in the country, namely Vodacom, Airtel, Tigo, Zantel, TTCL, Sasatel and Benson Informatics, it is pretty obvious that the government is getting a raw deal from the firms in terms of tax revenue.
The number of Rwanda’s total mobile users was 4.4 million by February, this year, barely a fifth of the number of users in Tanzania, but still garnered more taxes from its mobile phone operators than Tanzania.

Something must be seriously wrong somewhere – which calls for urgent and effective measures to curb this massive tax evasion in the mobile industry. It defies logic and morally rubs the wrong way for anybody who earns $1 billion to pay the government peanuts in taxes.

It might be a tax paradox to some people, but to us it’s just another one of those fishy deals which have been rocking this country for so many years. The public demands full explanation from TRA about why mobile companies have been taking the government for a ride when it comes to tax payment.

To be fair to all, including the mobile phone companies, we call upon the government to form a special committee to investigate these allegations so that, at the end of the day, fairness and justice is done.

The industry should be thoroughly investigated by an independent body, formed either by the government or the National Assembly, in order to establish the truth about the tax dues from these companies.



SOURCE: THE GUARDIAN

BAK, I am at a loss. Why the hell should he publish the revelation in the newspaper?

Has he forgotten that he is the deputy Minister?

Or maybe he doesnt know the scope of his duties.

By Ngambo Ngali

BAK, I am at a loss. Why the hell should he publish the revelation in the newspaper?


Has he forgotten that he is the deputy Minister?

Or maybe he doesnt know the scope of his duties.

Intresting observation!!!

By Ngambo Ngali

BAK, I am at a loss. Why the hell should he publish the revelation in the newspaper?

Has he forgotten that he is the deputy Minister?

Or maybe he doesnt know the scope of his duties.

Let`s wait and see his next step in order to deal with this problem...in my opinion this is daylight robbery.

By Ngambo Ngali

BAK, I am at a loss. Why the hell should he publish the revelation in the newspaper?

Has he forgotten that he is the deputy Minister?

Or maybe he doesnt know the scope of his duties.

Which duty! do you mean that of confidentiality?

By Watu

Intresting observation!!!

A company under his ministry and he writes a commentary in the newspaper, is that perform his duties. What is it that he wants to achieve?

Publicity stint?

For what reason?

By BAK

Let`s wait and see his next step in order to deal with this problem...in my opinion this is daylight robbery.

He has acted by publishing the same in the newspaper. Actually he has failed us he was supposed to do more than that.

By Nzowa Godat

Which duty! do you mean that of confidentiality?

He is the minister in that sector, mind you

This is how Ccm works. Former speaker msekwa was/is a board member.RA shareholder. !!

By Nzowa Godat

Which duty! do you mean that of confidentiality?

Contextually,I think he meant that as a Minister he should have taken a legal action as proposed by the person who brought this thread!!
This country is terribly reeking of Corruption!!!

By Ngambo Ngali

BAK, I am at a loss. Why the hell should he publish the revelation in the newspaper?

Has he forgotten that he is the deputy Minister?

Or maybe he doesnt know the scope of his duties.

Transparency, uwazi na ukweli. Hongera deputy minister.

ebu tutafsirieni na thithi vi yesterady(vijana) wenzenu, ili tushiriki hoja..kiukwel we kinda lost in this language, tired of being the roling stone.

By Ngambo Ngali

He has acted by publishing the same in the newspaper. Actually he has failed us he was supposed to do more than that.

Bado mawazo ya kibunge bunge na kujaribu kurudisha reputation yake iliuopotea.

Anyway, amefanya vizuri pia kutuhabarisha ili tumpush na hao mapapa waliobehind the whole tax evition saga; washindwe kumthibiti yeye na issue iwe closed now that the public is aware!

By Kilahunja

ebu tutafsirieni na thithi vi yesterady(vijana) wenzenu, ili tushiriki hoja..kiukwel we kinda lost in this language, tired of being the roling stone.

Sasa mbona sentensi mbili za mwisho ulizoandika zinakuonyesha kama haupo unavyojinadi? Au ndo yale ya ...kwa faida ya wengine...

And we all think that there is a government running the state..what a joke!!A bunch of mediocres.
He has brought attention to himself though and they are going to shower him with bribes until 'accountability' and 'patriotism' disappears from his dictionary.Soon he'll have a huge mansion equalling his dear sis.

I think he is quite right by screeming publicly so that we all know what is inside the box. Let us be fair and congratulate him for that. To me, we better give him a time and see what next. It is scaring!! This isthe best way of avoiding being bribed though. Because people are aware. Hongera Dogo.

we all know him he loves the media, that dude loves attention, voted the most 'interactive politician' of the year, having said that. . . i am not questioning his judgement ability!

By BAK

[B]To be fair to all, including the mobile phone companies, [COLOR=#ff0000]we call upon the government to form a special committee to investigate these allegations so that, at the end of the day, fairness and justice is done.

But it is the same government complaining, how can the government complain and investigate at the same time. When the Government starts complaining on an issue which it has absolute control Then something is absolutely wrong somewhere.

they`l silent him easily as they did in mineral sector....he just sending a hidden message to telecom industry tellin them "give me money o else i`ll proceed with this and you gona b in danger of loosing your revenue"

Just because we are collecting less taxes does not mean there is "Tax Evasion", Tax Evasion is illegal, maybe the phone companies are in full compliance with the law and that is all the taxes they are supposed to pay.
If he is making such a serious accusation he should have shown actual evasion not just low tax revenues.