Tax base expanded to boost revenue collectionThe Tanzania Revenue Authority (TRA) has launched special seminars to educate local residents, traders and business owners on the recently adopted Value Added Tax Act of 2014 which became effective 1stJuly 2015.
Arusha was the first region to be given such training in the Northern Zone.Later on TRA officials will proceed to the Lake Zone, Central and Southern Highlands for the same purpose. The maiden seminar was held here over the weekend.
The TRA Principal Officer Hamisi Lupenja said in the past, much revenue was lost through incentives like tax holidays and limited sources of revenue but through the new VAT Act adjustments, many of the past loop holes will be plugged.
The National Assembly in Dodoma recently enacted the Value Added Tax Act 2014 or essentially the VAT Act which has alreadybeen assented by the President and became operational on 1st July 2014.
According to Mr. Lupenja, the recently sailed VAT Bill 2014 now addresses issues such as streamlined exemptions, VAT on new forms of trade alignment with international best practices as well as the Intra union trade issues between Tanzania mainland and Zanzibar.
More than 100 participants, including local Traders, Business owners and other residents of Arusha attended the training. They were told that the VAT Act 2014 was aimed at resolving issues that were left out in the initial VAT Act of 1997, which have been controversial over the past years.
“Through the new act, the TRA is bracing at
improving the Government revenue collection by expanding the tax base
by capturing most economic activities,” said Lupenja adding that the
VAT Act 2014 has now provided a platform for more scrutiny on various
controversial issues and it has just addressed all of them.
Mr. Peter Kilasara of the Mawenzi Insurance Brokers in Arusha was however of the view that stakeholders should have been taught about the newly introduced law before becoming effective; “It is a good idea but we needed to be told about this before the VAT bill sailed,” he said.
The Co-Chairperson of Regional Stakeholders Forum, Mr. Nicholas Duhia said the new VAT Act requires profit making institutions running under religious organizations, like schools, water and health services, to start paying taxes and that VAT exemptions apply only to religious organizationsoffering essential social services free of charge or at affordable prices, not exceeding 50% of charges by private institutions on the same services.
"Our forum links taxpayers with TRA with the aim of creating a conducive and taxpayer friendly tax administration and compliance environment," he said.
Mr. Peter Kilasara of the Mawenzi Insurance Brokers in Arusha was however of the view that stakeholders should have been taught about the newly introduced law before becoming effective; “It is a good idea but we needed to be told about this before the VAT bill sailed,” he said.
The Co-Chairperson of Regional Stakeholders Forum, Mr. Nicholas Duhia said the new VAT Act requires profit making institutions running under religious organizations, like schools, water and health services, to start paying taxes and that VAT exemptions apply only to religious organizationsoffering essential social services free of charge or at affordable prices, not exceeding 50% of charges by private institutions on the same services.
"Our forum links taxpayers with TRA with the aim of creating a conducive and taxpayer friendly tax administration and compliance environment," he said.
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