Don’t tax capital markets: call

Dar es Salaam. Brokers have asked the government to spare capital markets from taxation to unleash their potential in building the economy.

Tanzania Stock Exchange Brokers Association (Tseba) chairman George Fumbuka said capital markets can play a big role in financing infrastructure projects like railways and roads but to sustain that the government needed to continue giving tax incentives.

The association is made up of 12 brokerage companies.

“Capital markets provide long-term financing to projects like railways which Tanzania is eyeing to pursue but if we want that to be successful, the government should avoid imposing taxes,” said Mr Fumbuka at a function to award the university challenge winners.

The government announced to abolish tax exemption on the listed shares during the tabling of the 2016/2017 budget in June this year but the attempt was resisted by both brokers and regulators, prompting its withdrawal during the endorsing of the revenue and expenditure plan.

The deputy minister for Finance and Planning, Dr Ashatu Kijaji, was the guest of honour at the event that also awarded certificates to 75 graduates of Derivatives Markets Certification Course.

The Investment Challenge is one of the public awareness creation measures taken by the Capital Markets and Securities Authority (CMSA) to deepen the markets.

However, Dr Kijaji directed the regulator to address some operational challenges and improve communication bottlenecks as it enhances the public awareness strategy.

“You need to deepen public awareness about the capital markets and their importance to the economy,” said Dr Kijaji.

“If there is a financial challenge, CMSA has a board of directors who can tell the management where to get the money,” she added.

She also advised the investment challenge to involve secondary school teachers as a way to disseminate the awareness to their schools.