COLLECTION of domestic revenues grew by 18.5 per cent in the 2021/22 financial year compared to the 2020/21 fiscal year, the Parliament was told.
Finance and Planning Minister Dr Mwigulu Nchemba told the Parliament on Monday that in the 2021/22 fiscal
year, the government collected 24.4tri/- while in the 2020/21 it collected 20.6tri/-.
“This increase was a result of continued strengthening of electronic systems for monitoring collections of revenues, improving business and investment environment in the country and increased tax compliance among taxpayers,” Dr Nchemba explained.
During the 2021/22, the government estimated to collect and spend 37.99tri/-. Until June 2022, the government
collected 36.92tri/-, equivalent to 97 per cent of the endorsed budget.
This amount involved 24.39tri/- domestic revenues, equivalent to 95 per cent of the target of collecting 25.69tri/-.
Despite the achievements, Dr Nchemba mentioned various challenges which occurred during the implementation of the budget, including the Russia-Ukraine war which weakened the economic activities which had already been affected by the Covid-19.
Hence, the economic growth in 2022 is expected to go down to 4.7 per cent compared to expectations of 5.2 per
cent.
Another challenge was an increase of prices and costs for transporting goods and services from outside the country, especially petroleum products, edible oil and fertilizers.
He went on to mention the issue of lack of an enabling environment for use of technology for collecting revenues in some ministries, public institutions and local government authorities.
Another challenge was the presence of some traders diverging tax, mainly by using informal entry points to
transport goods and not issuing electronic receipts to their customers.
Some of the steps taken to address such challenges was to continue increasing efficacy in production sectors such as agriculture, livestock, fisheries and energy in order to reduce dependence on imported goods.
The government also decided to give subsidy to petroleum products and farm inputs with a view to lessen living
costs to citizens.
Another measure was to effectively monitor implementation of the budget and plans with the aim of increasing production and export.
The government also closely monitored business trend in the world so as to identify opportunities brought about
by the Covid-19 and Russia -Ukraine war.
