Mining firms get more tax waivers

[Mdondoaji]

Wednesday, 22 June 2011 22:37

digg​ ​ By Damas Kanyabwoya The Citizen Reporter Dodoma. The government has offered more tax concessions to mining companies despite growing concerns that the country is not earning its fair share from minerals and other resources exploited by multinationals.In the Finance Bill 2011, the government also made further tax revisions by increasing excise duty on kerosene from Sh52 to Sh400.30 per litre and decreasing the traffic notification fee from the proposed Sh50,000 to Sh30,000. Finance and Economic Affairs Pereira deputy minister Ame Silima proposed when tabling the Bill in Parliament that mining firms that had signed mineral development agreements with the government before July 1, 2009 be given VAT special relief, which is also to be offered to mining exploration companies on commodities and services required for exploration. The 2009/10 Budget limited VAT special relief to prospecting and exploration companies. The government in the same year abolished excise duty exemption on petroleum products granted to mining companies. The five-year development plan endorsed by Parliament last week, which is supposed to guide the budget process from this year to 2016, calls for an increase in mining taxes and royalties, but the government has done the opposite in the Finance Bill 2011. The proposal immediately drew the condemnation of MPs, who said the government had not learnt from past mistakes. Opposition Chief Whip Tundu Lissu said it was incomprehensible that the government was considering offering mining companies more tax exemptions despite the fact that it was receiving less than it should from the firms. Earnings from gold exports totalled about $1.5 billion (Sh2.25 trillion) last year, but the government received only about $32 million (Sh48 billion) in royalties and taxes. “Will this government ever learn? The mining revenue and legislation review committees that the same government appointed over the years confirmed the fact that the mining industry is not a win-win situation. Why should we offer more exemptions now?” the Singida East MP (Chadema) queried. The London-based Society for International Development said in its recent report that mining companies earned $5 billion (Sh7.5 trillion) in ten years, but the government got less than $300 million (Sh450 billion) in the same period. Mr Geoffrey Zambi (Mbozi East-CCM) said the government was losing colossal sums in revenue from tax exemptions to mining companies, adding that it was wrong to offer more concessions. Mr Moses Machali (Kasulu-NCCR-Mageuzi) accused the government of double standards by scrapping VAT special relief to non-profit NGOs while offering the same to profit making mining companies, “whose contribution to the economy is almost negligible”. “I need an explanation why we have decided to tax non-profit organisations that serve the society in various ways and offer waivers to the big mining companies from rich countries,” he said. Mr Silima said the increase in tax on kerosene was aimed at curbing fuel adulteration, which has denied the government billions of shillings in revenue and eroded Tanzania’s competitiveness as a reliable transit trade route. But Mr Zambi criticised the proposal, saying it amounted to surrendering to fuel adulterers. The government also reduced excise duty on diesel from Sh314 to Sh215 per litre to reduce transportation and manufacturing costs as announced by Finance and Economic Affairs minister Mustafa Mkulo on Tuesday when responding to MPs’ views on the Budget. The adjustments mean that the price of a litre of diesel will fall from an average of Sh2,005 to Sh1,600, while petrol will retail for Sh1,790, down from Sh2,015. However, the price of a litre of kerosene has risen to Sh1,680 from Sh1,557. The government concurred with MPs that the Sh50,000 traffic offences notification fee proposed in the Budget was too high and lowered it to Sh30,000. However, the Opposition said this was still too high, and proposed that the fee remains unchanged at Sh20,000. The government also proposed that tax be charged on advertisements aired by pay-television companies based outside the country to level the playing field with locally based digital television companies. The VAT refund period has also been reduced from one year to six months due to the speeding up of VAT payments through the use of electronic fiscal devices. Firms and individuals and Tanzania Revenue Authority will be charged interest on delayed VAT payments and refunds. The interest rates will be in accordance with “the Bank of Tanzania discount rates at the beginning of the year.” The government, however, has given the TRA commissioner general the powers to waive interest, a proposal that was strongly opposed by MPs during debate on the Bill.The chairman of the Finance and Economic Affairs, Dr Abdallah Kigoda (Handeni-CCM), said granting such powers to one person was likely to prompt allegations of abuse or corruption when a decision to exempt interest was controversial or disputable. “Decisions to grant interest exemptions should be made by a special committee, and not one person,” Dr Kigoda said. The government also re-introduced VAT exemptions on household consumables such as food, clothes and soap to orphanages and other institutions caring for orphans and children from poor families. The exemptions were scrapped in the Budget proposals early this month. However, the abolishment of VAT special relief exemptions to NGOs stays. Source : The Citizen. Angalizo: ****%%%'''***!!!!

 

[Nyambala]

Duh! hizi bange za hawa viongozi wetu sijui mpaka lini!

 

[Saint Ivuga]

Angalizo: ****%%%'''***!!!!

 

[kimatire]

It is always easy to complain loudly and quit. Why didn't the man stay on board and fight. These are hard times and cuts are going to come from all sources. I saw in my day many blowhard's claim they could do wonders only to waste time and resources. Everyone has to put their best effort forward to get us out of this mess!

 

[tz1]

Sawa na kuongea na ukuta.Ni watu wasiokuwa na aibu na wanatufanya watz hatuna akili timamau.
We need action,the sooner the better.Amandaaaaaa

 

[Timor]

Why is this such a surprise? Whenever "Government" finds something working, they KILL it. How could we POSSIBLY have a "working", "functional" government. By definition it HAS to be dysfunctional, bloated and so far out of touch with the constituents that the "wailing and gnashing of teeth" of the taxpayer sounds to them like sweet music from the corrupt Gods to which they all pray. Phooey!

 

[ULUMI]

The system here is based on: Deception, and Corruption, and The end justify the mean!!
So no wonder Waste, Redundancy, and Mockery rule!

Wednesday, 22 June 2011 22:37

digg​ ​ By Damas Kanyabwoya The Citizen Reporter Dodoma. The government has offered more tax concessions to mining companies despite growing concerns that the country is not earning its fair share from minerals and other resources exploited by multinationals.In the Finance Bill 2011, the government also made further tax revisions by increasing excise duty on kerosene from Sh52 to Sh400.30 per litre and decreasing the traffic notification fee from the proposed Sh50,000 to Sh30,000. Finance and Economic Affairs Pereira deputy minister Ame Silima proposed when tabling the Bill in Parliament that mining firms that had signed mineral development agreements with the government before July 1, 2009 be given VAT special relief, which is also to be offered to mining exploration companies on commodities and services required for exploration. The 2009/10 Budget limited VAT special relief to prospecting and exploration companies. The government in the same year abolished excise duty exemption on petroleum products granted to mining companies. The five-year development plan endorsed by Parliament last week, which is supposed to guide the budget process from this year to 2016, calls for an increase in mining taxes and royalties, but the government has done the opposite in the Finance Bill 2011. The proposal immediately drew the condemnation of MPs, who said the government had not learnt from past mistakes. Opposition Chief Whip Tundu Lissu said it was incomprehensible that the government was considering offering mining companies more tax exemptions despite the fact that it was receiving less than it should from the firms. Earnings from gold exports totalled about $1.5 billion (Sh2.25 trillion) last year, but the government received only about $32 million (Sh48 billion) in royalties and taxes. "Will this government ever learn? The mining revenue and legislation review committees that the same government appointed over the years confirmed the fact that the mining industry is not a win-win situation. Why should we offer more exemptions now?" the Singida East MP (Chadema) queried. The London-based Society for International Development said in its recent report that mining companies earned $5 billion (Sh7.5 trillion) in ten years, but the government got less than $300 million (Sh450 billion) in the same period. Mr Geoffrey Zambi (Mbozi East-CCM) said the government was losing colossal sums in revenue from tax exemptions to mining companies, adding that it was wrong to offer more concessions. Mr Moses Machali (Kasulu-NCCR-Mageuzi) accused the government of double standards by scrapping VAT special relief to non-profit NGOs while offering the same to profit making mining companies, "whose contribution to the economy is almost negligible". "I need an explanation why we have decided to tax non-profit organisations that serve the society in various ways and offer waivers to the big mining companies from rich countries," he said. Mr Silima said the increase in tax on kerosene was aimed at curbing fuel adulteration, which has denied the government billions of shillings in revenue and eroded Tanzania's competitiveness as a reliable transit trade route. But Mr Zambi criticised the proposal, saying it amounted to surrendering to fuel adulterers. The government also reduced excise duty on diesel from Sh314 to Sh215 per litre to reduce transportation and manufacturing costs as announced by Finance and Economic Affairs minister Mustafa Mkulo on Tuesday when responding to MPs' views on the Budget. The adjustments mean that the price of a litre of diesel will fall from an average of Sh2,005 to Sh1,600, while petrol will retail for Sh1,790, down from Sh2,015. However, the price of a litre of kerosene has risen to Sh1,680 from Sh1,557. The government concurred with MPs that the Sh50,000 traffic offences notification fee proposed in the Budget was too high and lowered it to Sh30,000. However, the Opposition said this was still too high, and proposed that the fee remains unchanged at Sh20,000. The government also proposed that tax be charged on advertisements aired by pay-television companies based outside the country to level the playing field with locally based digital television companies. The VAT refund period has also been reduced from one year to six months due to the speeding up of VAT payments through the use of electronic fiscal devices. Firms and individuals and Tanzania Revenue Authority will be charged interest on delayed VAT payments and refunds. The interest rates will be in accordance with "the Bank of Tanzania discount rates at the beginning of the year." The government, however, has given the TRA commissioner general the powers to waive interest, a proposal that was strongly opposed by MPs during debate on the Bill.The chairman of the Finance and Economic Affairs, Dr Abdallah Kigoda (Handeni-CCM), said granting such powers to one person was likely to prompt allegations of abuse or corruption when a decision to exempt interest was controversial or disputable. "Decisions to grant interest exemptions should be made by a special committee, and not one person," Dr Kigoda said. The government also re-introduced VAT exemptions on household consumables such as food, clothes and soap to orphanages and other institutions caring for orphans and children from poor families. The exemptions were scrapped in the Budget proposals early this month. However, the abolishment of VAT special relief exemptions to NGOs stays. Source : The Citizen. Angalizo: ****%%%'''***!!!!

 

[Mdondoaji]

It is always easy to complain loudly and quit. Why didn't the man stay on board and fight. These are hard times and cuts are going to come from all sources. I saw in my day many blowhard's claim they could do wonders only to waste time and resources. Everyone has to put their best effort forward to get us out of this mess!

If what you are saying is true why don't our ministers and the entire cabinet do not see the cry of many Tanzanians at these mining firms. We all need to share the burden of paying taxes and not the burden of paying taxes is vested upon mwananchi while lobbyist from mining firms and telephone companies enjoying the cake. It should be vice versa but who will listen and that is why I said ***"""^^^&&&???!!!!

 

[Mdondoaji]

Angalizo: ****%%%'''***!!!!

Mkuu niliogopa ban