No more tax exemptions for military shops

Dar es Salaam. Aspecial tax relief members of the armed forces enjoyed through duty-free shops in military barracks has been revoked because it was being “grossly abused”, the government announced Wednesday.   

Finance and Planning minister, Dr Philip Mpango, said government introduced the waiver on Value Added Tax, excise and customs duty to members of the Tanzania People’s Defence Forces (TPDF) in recognition of their devotion to national service.

However, the minister said, the arrangement that saw the establishment of shops and canteens within military barracks, was being grossly abused.

“Because of this, there were revenue losses; other countries in the East African Community discarded this arrangement except Rwanda and Tanzania. Now we can no longer delay abolishing this tax relief,” he said while presenting the 2016/17 national Budget.

Dr Mpango said EAC finance ministers, who met at a budget preparation meeting, advised the government to look for an alternative way of providing cost-relief for its military.

“In order to continue offering services to the military, I propose allowances to soldiers to enable them to buy essentials on their own,” he said.

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