‘It is an industrial economy roadmap’

Friday June 14 2019


By Alfred Zacharia and Rosemary Mirondo @azacharia3 azacharia@tz.nationemdia.com

Dar es Salaam. The business community and economic analysts have hailed the 2019/20 national budget tabled in parliament yesterday, saying it will pave the way for attainment of industrial economy.

Some have, however, raised concern over the government’s decision to retain the VAT on local goods whose abolition they advocated for months.

The Tanzania Chamber of Commerce for Industries and Agriculture (TCCIA) vice president for industries Octavian Mshiu says the budget aimed to protect local industries and markets.

He said it was good that the budget has mainly focused on reducing cumbersome charges, fees, duties and taxes which have stifled local industrial operations and the markets.

Regulatory environment

He added that the government’s pledge to start implementing a blueprint prepared to improve business regulatory environment will change things around.


“I heard about the introduction of a special window at the Tanzania Revenue Authority (TRA) for traders to give their opinions. This proves that the government wants to listen and solve challenges facing the business community,” he said.

Economic analyst and a lecturer at University of Dar es Salaam (UDSM) Dr Omari Mbura said the budget presented a roadmap towards industrial economy.

True government vision

“I see that the government is really focusing on agriculture and industrial developments. The two reflect the true government’s vision of becoming an industrial driven economy country in 2020,” he said.

According to him, the emission of various fees, charges and taxes for industry and agriculture sectors as were a major step to industrial economy.

He praised the budget for widening the tax base and reduce the burden of small group like manufacturers.

“I am positive that if operation costs will be down, prices of our locally produced goods would also go down. This will help our manufacturer to access local and East African markets,” he said.

The secretary general for Association of Tanzania Business Community, Abdallah Mwinyi also hailed the budget for introducing reforms on taxation and regulatory measures, saying it will help to improve business environment and encourage establishment of local industries.

He said the measures will relieve consumers and increase employment opportunities.

He was however pessimistic on the decision to retain VAT on local goods as well as continuing to give the ports powers to decide on the taxes on imported goods.

The business community feels that the Ports Valuation Act gave too much powers to the Port Valuers decide on payments to be paid by importers ranging between Sh1 to Sh100, saying the law has created a loophole for corruption.

Stifling business

He stressed that the exorbitant taxes and numerous regulatory measures were stifling the business community.

“We are also happy with the government’s decision to start implementing the business blueprint which, according to Dr Mpango will commence in July 1, this year, and after that we will be in a better position to understand the new reforms,” he said.

He expressed worries over government’s decision to retain the VAT on local goods, saying the community had for months been advocating for its abolition.

According, they had proposed for retention of VAT only on imported goods, airports, borders and industries where goods are produced but wanted them abolished on goods that are sold locally because they increased consumer price.