Saturday, June 12, 2010

Calls for mechanism to broaden revenue base

The Parliamentary Standing Committee on Finance and Economy of Tanzania has endorsed the proposed 2010/2011 national budget tabled on Thursday 10th 2010, saying it will help stimulate the country’s economy. Tabling the committee’s economic report for the 2009/2010 fiscal year and suggestions on revenue collections and expenditures for the financial year 2010/2011 in parliament yesterday, the Chairman, Dr Abdallah Kigoda gave full endorsement of the budget proposals. The Handeni legislator (CCM) and former finance minister said however, that there were areas that needed to be rectified in order to have a budget that would ensure sustainable development. One vital area was for the government to search for new revenue sources instead of adding tax on luxury goods which at the end become a burden on workers, farmers and the business community.

A member of Parliament for Lushoto constituency, Dr. Abdallah Kigoda on the right with a Minister for Fisheries Dr. John Maghufuli recently during budget session outside the national parliament.
Dr Kigoda said the government should set up a comprehensive tax administration and collection mechanism which was likely to boost the budget. “Adding tax on some of the goods does not bring any relief, but rather a burden to farmers, workers and traders. This would result into high cost of doing business, hence affect our economy”, he said. He said with high tax rates, the government was encouraging tax evasion and corruption. Dr Kigoda challenged the government to control expenditures because it was expected to spend 26.4 per cent of the 2010/2011 budget while revenue collections were expected at 17.3 per cent only. Official Opposition Leader in Parliament, Hamad Rashid Mohamed said the proposed budget would negatively affect the private sector and ordinary citizens. Hamad, who is also a Member of Parliament for Wawi constituency, said this when presenting a substitute budget for 2010/2011 fiscal year. “The budget favours rich people and will adversely affect ordinary citizens,” Hamad stressed, adding that it does not build the capacity for the country to be self sufficient. “We have been advising the government to reduce its size because it results into increased expenditures,” Hamad said, emphasizing the nation’s Vision 2025 was good but that it lacked supervision and was not known to majority Tanzanians. He reiterated the opposition camp’s call to the government to implement development projects through the Public Private Partnership (PPP). For his part, Tabora Urban MP, Siraju Kaboyonga said that Tanzania was a rich country but that the government was yet to properly utilize the available resources including the Dar es Salaam, Tanga and Mtwara ports.

Zitto Kabwe a member of parliament for East Kigoma urban.

He said the three ports, if properly utilized, could boost the country’s economy. Kaboyonga said that infrastructure remained the great challenge to the economy, calling on the government to put extra efforts in ensuring the Tanzania Railway Limited (TRL) became operational. “This country will not have a developed economy if the infrastructure is not improved. We need to put in place good regulations to protect our industries,” said Kaboyonga. Kigoma North MP, Zitto Kabwe (CHADEMA) said the government would have to borrow 23/- in every 100/- it would spend. Kisarawe MP, Athuman Janguo (CCM), said this year’s budget was not development oriented because it had allocated more funds for recurrent expenditures than for development. Janguo said that it wasn’t proper for the government to spend more than what it generated. Kwela MP, Chrisant Mzindakaya (CCM) said it was a shame for the country to continue having a donor dependent budget 40 years after independence. He said a country that survived on donor assistance would never be free, stressing that if the available natural resources were properly utilised, Tanzania could have a self-sufficient budget.

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