TAX COLLECTION: Samia demands fairness

DAR ES SALAAM: PRESIDENT Samia Suluhu Hassan has strongly denounced the malpractice of tax evasion, emphasising that the Tanzania Revenue Authority (TRA) must ensure that all individuals and entities with a legal obligation to pay taxes fulfil their civic duties.

Speaking at the Taxpayers’ Appreciation Awards for the 2023/24 fiscal year in Dar es Salaam yesterday, President Samia pointed out that tax evasion hinders the country’s development and delays the government’s ability to execute its plans.

She highlighted the detrimental effects of such practices on essential services, such as the timely supply of medicine to health centres and the broader Tanzanian population.

“Tax evasion disrupts fairness in business. Those who evade taxes gain an undue advantage over compliant businesses, creating an uneven playing field. TRA must ensure that every taxpayer contributes their fair share, ensur- ing a level playing field for all businesses,” she said.

The President also urged TRA officials to uphold integrity in their operations, stressing the importance of eliminating practices that create inequity in tax collection.

She warned against corruption within the system, calling for swift action against employees who enable or promote unfair tax practices.

According to President Samia, such actions not only undermine fairness but also fuel corruption, which is detrimental to the country’s progress.

On the issue of fraudulent practices, President Samia cautioned businesses against using forged Electronic Fiscal Device (EFD) receipts and counterfeit Electronic Tax Stamps (ETS) for excisable goods to evade taxes.

She revealed that recent investigations had uncovered fraudulent activities threatening the government’s revenue collection.

“We cannot allow such malpractice to continue. TRA must act decisively to protect the country’s resources,” she said.

The President also addressed the misuse of transfer pricing by some companies, calling it an injustice to both the government and Tanzanian citizens.

“Addressing these issues is critical, and I urge TRA to remain vigilant and take firm action against such practices,” she added.

In response to claims that some individuals evade taxes by citing directives from higher authorities, President Samia clarified, “In Tanzania, the highest authority is the President. I have never issued any directives instructing anyone not to pay taxes.

If the need arises to issue instructions, they will be in writing, not verbal. Everyone conducting business must pay their taxes.”

Additionally, she directed the Minister for Finance, Mwigulu Nchemba to address the backlog of pending tax cases at the Tax Appeals Board and Tax Appeals Tribunal.

ALSO READ: SGR expansion to boost connectivity in northern zone

These cases, which demonstrate taxpayers’ right to appeal, must be resolved swiftly to ensure justice and maintain efficient revenue collection.

She also underlined the need for the minister to strengthen the institutions’ capacity to handle cases without compromising the quality of their decisions.

TRA Commissioner General Yusuph Mwenda praised the Taxpayers’ Appreciation Day as an opportunity to honour taxpayers’ contributions to the nation.

He explained that the event recognises those who excel in fulfilling their civic duties, noting that all taxpayers, regardless of size, play a vital role in the country’s development.

“TRA is awarding taxpayers across Tanzania who have met the criteria, including good tax record-keeping, timely voluntary payments, proper use of EFDs and ETS, substantial tax contributions and effective cooperation with TRA,” he said.

These criteria aim to encourage fairness and commitment in fulfilling tax obligations. Chairman of the Tanzania Business Community, Mr Hamisi Livembe, acknowledged the government’s reforms aimed at improving the business environment but raised concerns about the burdens of unpaid debts from audits that had not been conducted on time, some dating back three to five years.

“We request TRA to reduce the audit timeline from five years to three,” he said.

Vice-Chairman of the Tanzania Private Sector Foundation (TPSF) Paul Makanza, expressed the private sector’s commitment to collaborating with the government, TRA and various ministries to foster economic growth and boost tax revenues.