Tax evaders get 7-day ultimatum

ALVAR MWAKYUSA

PRESIDENT John Magufuli has issued a seven-day ultimatum to tax defaulters to settle their obligations lest they face the wrath of the law.

The ultimatum comes in the wake of recent revelation that over 349 containers ‘vanished’ from inland container depots without paying requisite duties to the government. Dr Magufuli sounded the warning at the State House in Dar es Salaam at a meeting with the business community in which he also assured them of favourable business and investment environment.

“The government recognizes the role of the private sector as a catalyst of economic growth and I encourage you to exploit available opportunities for the betterment of the economy at large,” the president remarked. He expressed concerns on the other hand that some dishonest businesspeople were cheating the government of taxes and warned of tough action against them.

“The country has been facing limited funds to carry out its obligations due to tax evasion by a number of traders as well as swindling of public funds by some civil servants,” he noted with concerns. He added; “Since assuming the presidency (on November 5) I have found out that no funds were disbursed for development projects for the past six months.

It is only this month that we have dished out 120bn/-.” According to Dr Magufuli, disbursement of money for other charges (OC) in public institutions was also troubling the government, almost six months since the budget for financial year 2015/2016 was endorsed by the National Assembly.

The president pledged to work closely with the private sector to boost revenues, stressing however that he will not tolerate deceitful business people during the Fifth Phase Government.

“When I was seeking votes for this office I neither sought nor received a single penny from any businessperson and this should send a clear message to you that I want to work with honest people,” Dr Magufuli said matter of-factly.

Dr Magufuli thus urged them to operate their trade in line with existing laws and regulations of the land for the interest of majority Tanzanians. He went on to caution the trend by some wealthy people in the society fond of harassing the have-nots that their days were numbered.

“In the same development, I urge you to bring to my attention or the Chief Secretary any public servant who will be frustrating your business ventures. “My government will see to it that there is favourable environment for the private sector through capacity building and scrapping of nuisance taxes,” he stressed.

Dr Magufuli said he was aware that there were numerous taxes and levies which were burdening both traders and farmers countrywide and pledged to review them. “In Kagera Region for instance, coffee farmers are being charged 26 different levies and this forces them to smuggle the cash crop to neighbouring Uganda. These are among issues to be solved,” he pledged before the business community.

The president as well urged local investors to explore investment opportunities they can exploit; noting that the government will support such ventures. “I will feel proud to see local investors venturing in industries such as processing of minerals, fish, leather and other resources that the country is endowed with,” he remarked. Dr Magufuli was irked that despite Tanzania being the only producer of Tanzanite in the world, India and Kenya were the leading exporters of the gemstone.

He mentioned other ventures which could be utilized by local business community as revitalization of former industries which have collapsed as well as setting up of new ones.

“You should turn up for all opportunities that are available even in the natural gas sector; there have been this talk that local investors are not capable of investing in this area but I dare you to go on since no government can prosper without empowering its people,” he stressed.

Speaking at the same occasion, the Chairman of Tanzania Private Sector Foundation (TPSF), Mr Reginald Mengi, said the business community had a lot of trust in President Magufuli in solving issues affecting the economy.

He appealed to Dr Magufuli to amend the Prevention and Combating of Corruption Act to give more powers to the anti-corruption watchdog, stating that graft was the leading obstacle to development in the country. Dr Mengi mentioned some of challenges facing the business community as numerous taxes, poor infrastructure in some areas and unreliable power, among others.

Meanwhile KATARE MBASHIRU reports that Tanzania Freight Forwarders Association (TAFFA) has declared that it will revoke the membership of people who will evade tax at ports including publishing their names in local newspapers.

The association said it will further reveal the names of people or companies evading tax and disclose their names in all ports so that they are barred from importing any shipping container from outside the country.

Speaking at a news conference in Dar es Salaam yesterday, TAFFA president Stephen Ngatunga condemned the acts by unscrupulous business tycoons who submitted false declarations in the tax ledger of the Tanzania Revenue Authority (TRA).

The decision to issue a termination of membership alert came just a few days after President John Magufuli suspended the TRA boss, Rished Bade and eight other senior officials of the tax watchdog over 349 missing shipping containers that evaded tax amounting to 80bn/- in government revenue.

Mr Ngatunga commended the government’s efforts in cracking the whip against people who were evading tax at the Dar es Salaam port promising to help in revealing their identities.

“It is a shame to hear that 349 containers are missing and we are ready to reveal the names of people and companies involved in this syndicate should we prove beyond reasonable doubt that they did not pay tax,’’ said TAFFA Vice- President Mr Edward Urio.

According to Mr Urio, their association was aware that there were many people who were not paying tax but did not take any action because they were not receiving any cooperation from TRA and the Ministry of Finance.

“At some point we conducted a meeting with the then Finance Minister, Mr William Mgimwa (who is now dead) who was very cooperative but later we did not receive any cooperation by his successor when we submitted our queries on tax evasion.

TAFFA was yesterday convinced by the government led by Dr Magufuli on the way it dealt with people evading tax at the country’s major port. Last week, TRA commissioner and other senior officials were suspended following a surprise visit by the Prime Minister, Mr Kassim Majaliwa, in the wake of ‘disappearance’ from the TRA tax ledger of 349 containers leading to a loss of over 80bn/- loss in government revenue.

The move widely won approval by some economists and other citizens who expressed hope for a new Tanzania. On Thursday, TAFFA president described the move as timely and the right path towards self-sufficiency. He said his association would continue working with the government in a move to ensure that there was proper tax compliance.