Zanzibar to lower budget dependence
ZANZIBAR: ZANZIBAR has embarked on strategic moves to lower budget dependence from 6.3 to 4.9 per cent through improved revenue collections, Minister of State, President’s Office, Finance and Planning Dr Saada Mkuya Salum announced here yesterday.
Unveiling Zanzibar’s 2025/26 national budget, which she said focuses on sweeping measures to strengthen revenue collection and speed up the country’s economic development, Dr Mkuya assured that Zanzibar is ready for economic transformation.
She said the government is determined to adopt transformative policies to strengthen revenue collections and speed up the country’s economic development, imposing punitive taxes on imports that deter domestic production.
“The government has been taking special measures to stabilise the tax regime in the country as one of the strategies to improve business environment, promote investment and voluntary tax payment,” Minister Mkuya said in her three-hour budget speech.
She said the government is determined to strengthen revenue collections, saying promotion of domestic industrial production and an increase in excise duty are some of the targeted measures.
The minister proposed an over threefold rise in excise duty on chicken and fish imports from the current 300/- to 1,000/- per kilogramme to protect domestic production, with the view of attaining fair competition and protecting jobs for Zanzibaris.
She further asked the house to approve an introduction of infrastructure levy to protect and promote domestic industries as well as ensuring fair competition in the market.
Minister Mkuya proposed a 50/- levy on one litre of imported bottled water; 1,000/- levy per one tray of imported eggs and five per cent infrastructure levy on imported soft drinks, carbonated juices and non-alcoholic beverages.
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Transporters will as well pay one per cent levy on imported product haulage while importers of non-woven bags will finance infrastructure development at the rate of five per cent levy.
The minister further announced a proposed increase levy on imported spirits from 4,386/- to 6,000/- per litre, while Sheesha flavour importers will have to pay tax at the specific rate of 28,232/- per kilogramme of flavour, believing that the heavy tax will protect the youth against the drugs.
In a drastic move to protect the environment against pollution, Dr Mkuya proposed a five per cent excise duty on imported disposable items.
The minister further informed the house that establishment of funds for provision of superb social services is one of next financial year’s priorities, citing health service fund, education development fund, water development fund and environmental management fund.
The government further intends to transform revenue collection institutions to boost efficiency in collection and management through delegating the responsibility to Zanzibar Revenue Authority and establishing the Zanzibar Halal Bureau to administer service provision of Zanzibaris and visitors.
The minister said the government is determined to review and repair tax laws to cement management of government revenues, introduce electronic system uses in revenue collections at the ministries and government institutions.
Dr Mkuya asked the house to approve 6.98tri/- for the coming fiscal year, with 2.43tri/- and 4.55tri/- budgets for recurrent and development expenditures, respectively.
