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PanAfrican Energy starts paying taxes

PanAfrican Energy starts paying taxes

PAT General Manager, Mr Andrew Brown said Ilala by-laws forced the company to pay municipal levy in Dar es Salaam other than in Kilwa District where the company extracts natural gas which is used to generate electricity fed into the natural grid and also directly supplies industries in the commercial capital.

“Pan African Energy pays all of its taxes as required by law. We have been paying the municipal levy to Ilala municipality, based on the requirements of the Ilala by-laws, until the end of 2011,” Mr Brown said in a statement while responding to the ‘Daily News’ questions as to why only 87m/- out of over 606m/- which Kilwa district council leaders claim is outstanding levy, was paid.

  “PAT has always been willing to pay taxes to Kilwa district, our only concern has been that this should happen through the correct legal mechanisms. That has now happened and based on new instructions from the government, the levy is now being paid by us to Kilwa District Council instead of Ilala Municipality, as of March 2012,” Brown pointed out.

Last week, the ‘Daily News’ sister newspaper, HABARILEO reported that authorities in Kilwa were demanding payment of a backlog of district levies dating back to last year as PAT remitted only 87m/- out of the 607m/- backlog. According to Kilwa District Executive Director, Ado Mapunda, PAT had refused paying 0.3 per cent of naturals gas sales per month as levy since 2011, saying the company was doing so in Dar es Salaam where it is based.

“We are happy that after a long period of negotiations, the company has started paying the levy since last January,” Mr Mapunda said.  Mr Mapunda said the money will go towards implementing education, health, infrastructure and water projects to benefit the district’s over 100,000 residents.

Kilwa is one of the poorest districts in the country in terms of income per head while endowed with a myriad of natural resources including natural gas, hardwood, mangroves, fish and beautiful beaches to name but a few. PAT came under fire last year when an ActionAid Sweden report unveiled that it had denied Treasury 65 million US dollars (about 97.5bn/-) in taxes between 2004 to 2011.

During  the national budget session last year, several Members of Parliament  questioned PAT’s gas extraction deal from Songo Songo islands which charges hiked prices on state owned Tanzania Electric Supply Company (TANESCO) despite numerous tax exemptions.

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Author: FINNIGAN WA SIMBEYE

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