Budget rises to Sh22.5tr

Finance Minister Saada Mkuya  

By Veneranda Sumila, The Citizen Reporter

In Summary

The amount, presented to Members of Parliament in the city, is Sh2.68 trillion more than the Sh19.8 trillion 2014/2015 budget that was approved in June last year.

Dar es Salaam. Finance Minister Saada Mkuya yesterday pegged Tanzania’s 2015/2016 budget at Sh22.48 trillion as the government intensifies efforts to boost revenue collection and reduce donor dependency.

The amount, presented to Members of Parliament in the city, is Sh2.68 trillion more than the Sh19.8 trillion 2014/2015 budget that was approved in June last year.

At least Sh14.82 trillion of the Sh22.48 trillion will be sourced internally, with efforts being directed towards enhancing the use of Electronic Fiscal Devices in order to seal loopholes for revenue leakages.

Tanzania Revenue Authority alone will be required collect Sh13.35 trillion, reflecting 90.1 per cent of the total domestic revenue.

The money will be Sh2.053 trillion more than the Sh11.297 trillion that the taxman is expected to garner in the current financial year.

The government will also reduce tax incentives to collect much-needed revenue as the country moves towards a donor-free budget, Ms Mkuya said. “We will also take measures to improve the business climate so as to attract informal business operators to formalise and help the government collect tax from them,” she added.

Part of the money will also be sourced through a review of various tax rates. Property owners will also start contributing immensely to government revenues during the 2015/2016 financial year as a plan is in the offing to start charging them based on the value of the property.

Property owners currently pay a uniform tax that does not take into consideration the value of the property in question.

According to Ms Mkuya, the government plans to collect Sh949.2 billion from non-tax revenue and Sh521.9 from municipals.

This is expected to help government institutions, agencies and independent authorities collect enough revenue to finance their operations instead of depending on the central government for their financial requirements.

The government plans to borrow a total of Sh5.77 trillion to finance its budget and raise Sh1.89 trillion from development partners. “We have decided to significantly reduce donor dependency and put more effort into mobilising domestic revenue,” said the minister.

But the proposed budget came in for immediate criticism from some MPs. Parliamentary Committee on Economic Affairs, Industry and Trade Chairman Luhaga Mpina said Ms Mkuya’s figures sounded good but there was little to show how the plan would be implemented.