What you need to know:
- TRA said at the weekend that it collected Sh5.923 trillion from July to the end of September 2022, compared to the target of collecting Sh5.978 trillion
Dar es Salaam. The Tanzania Revenue Authority (TRA) has announced that it has collected Sh5.92 trillion in taxes, an amount that is equivalent to 99.1% of the targeted collection in the first quarter of the 2022-2023 fiscal year.
According to a statement released on Sunday October 2, by the Commissioner of TRA Mr Alphayo Kidata, the authority had targeted to collect Sh5.978 trillion during the period.
The impressive first quarter performance, according to Mr KIdata, was attributed to the rising willingness to pay taxes; improved relations between the authority and taxpayers; timely resolve of issues, and the current growth of business and economic activities in the country.
Also he said growth in local industries and international trade led to the achievement.
However, the analysts suggest there are still some challenges that need to be addressed in the country’s tax administration systems.
A senior consultant and economist, Prof Samuel Wangwe, said, “The government has opened up the economy, so more businesses are operational. However, despite President Samia Suluhu Hassan’s drive to end harassment in tax collection, there are still some few cases where this is still happening,”
“TRA should ensure that the efficiency also translates into how they collect tax, ending all forms of harassment to businesses so that we can get optimal results and support our economic growth,” he said.
Prof Wangwe also advised that there is another concern of unbearable penalties and fines for late payments which in some way discourage willingness to pay taxes.
“Fines or penalties should be there but on a level that is reasonable. We want to stimulate timely tax payment, not scare or push away people because of huge tax arrears,” he said.
The chief executive of the Institute of Management and Entrepreneurship Development, Dr Donath Olomi, said Tanzania could double its tax targets if all business concerns are addressed.
“It is not surprising that we were able to achieve the targets or exceed it in some months, because the foreign trade and investments environment has improved over the recent years,” he said.
“However, there are outstanding issues like the Electronic Tax Stamp (ETS) to manufacturers which have been voiced over its expensiveness and how it affects overall costs of production,” he said.
Dr Olomi said, going forward, the tax authorities need to continue creating a good relationship with taxpayers especially businesses and discuss how to resolve challenges and concerns that are still impending.
“Who knows maybe we have the potential to collect even more tax or double our target if all issues were to be effectively addressed,” he said.
Recently, manufacturers raised concerns that they have been incurring high costs for the ETS, reaching nearly Sh100 billion a year to acquire the stamps from the Sicpa, a Swiss company mandated to supply ETS.
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