Tanzania revenues body told why tech is key to boosting tax collections

Dar es Salaam. A global Customs organization wants Tanzania to invest more in new technologies as a way of boosting tax revenue collections for the general good of the economy.

The World Customs Organization (WCO) believes that investment in innovative technologies is the only way to boost tax collections - thus enhancing the country’s ability to invest in world-class infrastructure, amont other things. “A country cannot run away from technology if it is to effectively manage tax collections through Customs,” the WCO’s secretary general, Dr Kunio Mikuriya, said recently.

He was speaking in Dar es Salaam where he had held talks with the Tanzania Revenue Authority (TRA) commissioner general, Dr Edwin Mhede.

Established as the Customs Co-operation Council (CCC) in 1952, the WCO is an intergovernmental organization that works to improve the efficiency and effectiveness of customs administrations worldwide.

The advice comes at a time when TRA was undertaking several technological advancements to streamline operations of its Customs department.

In 2014, TRA introduced the web-based Information Technology system Tanzania Customs Integrated System (Tancis) to progressively facilitate paperless Customs operations.

TRA has also implemented the Electronic Single Window System through the Tancis platform which links Customs with other government authorities and the private sector.

In the excise duty category, TRA has also implemented the Electronic Tax Stamps (ETS) system whose implementation - reports say - has played a significant role in boosting revenue collections.

The first phase of the ETS rollout was conducted on January 15, 2019 whereby stamps were installed on 19 companies that produce alcohol, wine and spirituous beverages. The second phase - which saw to ETS being stamped on soft and carbonated drinks as well as bottled water - was rolled out on August 1, 2019.

Available data show that the taxman garnered Sh77.8 billion in excise duty on spirits and wines between February and October last year, compared to the Sh58.2 billion collected during the similar period in the year before (2018).

During the same period, VAT on simila products - spirits and wines - grew by 30.6 percent, to Sh23.5 billion. There were 8.7 percent and 19.5 percent increases in excise duty and value-added tax (VAT) collections respectively on soft drinks during the same period.

Dr Mikuriya asked TRA to foster its adoption of various technological systems with a view to boosting revenue collections - while, at the same time, tweaking its workforce with latest developments in technologies. In his remarks, Dr Mhede said Dr Mikuriya visited Tanzania because the country is a member of the WCO - and, thus, there is a need to foster working relations between the two.

“Tanzania is a member of the WCO. We work closely on a number of issues aimed at ensuring that there is safety and security in the conduct of customs operations,” he said.

Tanzania shares borders with a number of land-locked countries. As such, the country is a main gateway for imports and exports to/from Malawi, Zambia, Zimbabwe, Uganda, Rwanda, Burundi and the DR Congo.