Tanzania Revenue Authority Doubles Tax Collections In January 2016

The Tanzania Revenue Authority (TRA) has recently announced that a total of TZS 1.79 trillion in tax revenues were collected solely in January, 2016, which are almost in line with TRA’s goal of collecting at least TZS 2 trillion per month and are up by 135% from the TZS 0.76 trillion collected in January, 2015.

The announcement was done by TRA Commissioner General Alphayo Kidata, whom in a recent press conference explained that the jump in revenue collections from domestic sources have been achieved thanks to better practices and systems that supported a better following of taxpayers.

The government’s pursuit is to ensure a tax revenue of at least TZS 2 trillion per month to ensure that the country can develop itself without donor dependence, reason why since President John Magufuli assumed the charge several measures have been taken and tax collections have improved considerably, Mr. Kidata added.

Tanzania has passed from collecting an average of TZS 0.82 trillion per month before the fifth phase government came to power to collect TZS 1.3 trillion in November, 2015, TZS 1.4 trillion in December, 2015, and the amount previously cited in January, 2016, Mr. Kidata stressed.

According to Ministry of Finance and Planning Permanent Secretary, Mr. Servacius Likwelile, a better tax revenue supports economic growth and human development since from the more disposal of funds the government has recently disbursed TZS 81.1 billion to the pension fund system, TZS 573 billion to cover public payrolls, TZS 23 billion for free education, TZS 18 billion for loans to graduate programs, TZS 13 billion to water projects, and among other development projects.

The TRA expects to have surpassed the goal of TZS 2 trillion on tax revenues in February, 2016, and keep the track to considerable improve the income from taxpayers after they recorded in 2015 an average of TZS 0.83 trillion per month.

Since TRA’s inception in 1996, the Authority has raised tax revenues from TSZ 299.9 billion at the end of 1995 to over TSZ 9,800 billion at the end of 2015, representing an increase of 3,178%.

According to Tanzania’s 2016/2017 draft budget recently discussed by the Minister of Finance and Planning Philip Mpango, estimated expenditures are expected to rise to TZS 22.99 trillion up from TZS 22.4 trillion in 2016/2015 and to be covered exclusively by tax revenues.

In previous years tax revenues were covering less than 50% of Tanzania’s expenditures but government officials are currently working to ensure growth in tax revenue collection to raise its current participation of 12% of GDP.