PRICES of goods and services are currently declining to readjust to their equilibrium level after they skyrocketed following government drive to curb tax evasion loopholes, according to a Bank of Tanzania (BoT) economist.
Mr Lusajo Mwankemwa told senior
reporters at a seminar in Zanzibar that prices had gone up after
President John Magufuli crackdown against tax evaders, corruption and
wasteful government spending when he came to power in 2015.
"This is the transition period where
prices of various goods and services are readjusting to stability and
reach the real position," he said in the seminar. Mr Mwankemwa the
crusade against tax evasion had touched some business who imported goods
without paying taxes and sold them at low prices.
"After the crackdown, some business
people closed their businesses while others increased the prices to
cover the real cost of importing or producing goods and services," he
said.
However, inflation trends since last
October was on increase pattern started from 4.5 per cent to go up to
5.5 per cent this February. The trend reverse has occurred in due course
following government decision to channel the scarce resources to
development expenditure.
This way will contribute to economic
growth with expectation of benefitting its people through its trickle
down effects. For example the increased investment in infrastructure,
transport and other cost will definitely go down thus impacting on the
prices of goods and services to the final consumer.
However efforts should be done to
promote consumption in order to stimulate economic activities in the
manufacturingand other business sector
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