Horticulture’s wish list on

TANZANIA: AS anticipation builds for the government main budget for 2024/25 slated to be tabled in the National Assembly tomorrow, the horticultural champion has presented the wish list to spur the multi-million-dollars industry.

The Tanzania Horticultural Association (TAHA) has put forth crucial fiscal reform proposals, aimed to boost the industry for it to grow by leaps and bounds.

Top on the wish list, TAHA Chief Development Manager, Mr Anthony Chamanga says, are unfavorable tax measures on seed research and delays in VAT refunds.

Mr Chamanga said that one of the major barriers is the taxation of services tied to seed research and breeding by multinational companies.

“The imposition of VAT on these services has not only discouraged investment, but also impeded the development of high-quality, resilient seeds” he explained.

TAHA said that Tanzania could attract more multinational seed companies, fostering innovation and boosting productivity within the horticultural industry by reducing the tax burden.

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Perhaps the most pressing issue throttling the financial health of horticultural businesses is the sustained delay in VAT refunds.

“Since 2020, numerous horticulture companies have been grappling with unsettled VAT claims that have severely impacted cash flow and liquidity” Mr Chamanga noted.

These delays, he said, have led to dire financial straits, with some companies failing to meet critical obligations such as loan repayments and timely salary disbursements.

“We hope the government budget will address this issue of timely VAT refunds, as part of strategy to enable the investors inject much-needed liquidity into the industry, allow businesses to recoup losses and invest in further growth” Mr. Chamanga said.

Another critical hurdle identified by TAHA is the excessive taxation on packaging materials for processed vegetables and fruits, including ascetic bags and comical drums.

For them, these taxes have created significant disincentives for investments in processing facilities, undermining Tanzania’s competitiveness in both domestic and regional markets.

As the global demand for processed horticultural products surges, removing such tax barriers would bolster Tanzania’s position as a formidable player in this lucrative business, he emphasized.

TAHA believes that by addressing these key issues it could open the floodgates for heightened investments, job creation and economic diversification.

“With the right fiscal policies in place, Tanzania’s horticultural industry could not only sustain its current achievements, but ascend to new heights, cementing its role as a cornerstone of the nation’s economic landscape” Mr. Chamanga concluded.

ALSO READ: Horticulture exports soar as Samia unlocks global markets for perishable crops

The horticultural subsector in Tanzania achieved a 44 per cent growth in export value for 2023, thanks to the proactive policies of President Dr Samia Suluhu Hassan’s administration.

Following the Covid-19 pandemic’s impact, the industry has rebounded, with export values rising to 418 million US dollars from 290 million US dollars in 2022, according to the Bank of Tanzania.

This recovery is significant for a sub-sector that previously faced a downturn, with its value at 780 million US dollars before the pandemic.

Data from the Ministry of Agriculture highlights a substantial growth in avocado exports, which have risen from 17,711 tonnes (51 million US dollars) in 2021 to 26,826 tonnes (77 million US dollars) in 2023. This increase is largely due to efforts to access global markets for Tanzanian avocados.

Dr Jacqueline Mkindi, CEO of the Tanzania Horticultural Association (TAHA), credits this success to President Samia’s leadership, which has focused on improving the industry’s global market access.

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