TANZANIA: Tanzania Revenue Authority (TRA) Disbands Task Forces
The uproar that greeted the formation of tax task forces a number of years ago changed perceptions of tax collection in many ways.Indeed, everyone has a civic duty to pay taxes, and it is assumed that no one would intentionally avoid fulfilling this moral duty.
However, the task forces have in recent years harassed business people ostensibly in order help the Tanzania Revenue Authority (TRA) meet its targets.
Many Tanzanians closed their businesses across the country because of the out-of-control task forces, which, many a time, compelled people into bribery, or closure.
However, there is a huge relief after TRA confirmed the disbandment of task forces, which gained infamy during the Fifth Phase government.
Many still believe that they are morally obliged to obey the law and pay their fair share of taxes. However, the task forces made many Tanzanians bemoan their tax bills.
It is a commendable move by TRA to hold discussions with businesspeople, and review orders that treated people unfairly.
It is unfortunate that some businesses, which used to employ many Tanzanians, have collapsed, and some are struggling to become as vibrant as they were.
The taxman should devise a more friendly strategy, which will be educative, and promote, not discourage, businesses.
In this regard, there is a need to aggressively pursue tax avoidance strategies instead of employing strong-arm tactics and closing businesses.
It is time TRA ensured that all people understand that paying taxes is one way of avoiding many risks.
Fairness when it comes to tax collection should come first. Many agents are still unscrupulous. They use every order to their personal advantage.
Tax morality is an issue that both taxpayers and government need to address on a serious note.
Intrinsic willingness to pay tax can greatly assist Tanzania in formulating tax policies and administration.
Why the future looks bright
Tanzania is better positioned today than it was five or six years ago in terms of a friendly environment for business and investment. A friendly investment and business climate is crucially pivotal to a country’s development. What Tanzania needs is functional development which is meaningful and sustainable.
Positive change is largely a result of ongoing measures being taken by the Sixth Phase government of President Samia Suluhu Hassan that are intended to revamp the country’s ease of doing business, thus creating a decidedly business-friendly environment.
Indeed, the government is already undertaking across-the-board reforms in industry and trade with a view to vastly improving the business climate. A clearly friendly business environment is an inescapable criterion which prospective investors look for in their boardrooms as they consider investment destinations and related decisions.
It is all about holistic revamping of the investment environment in order to improve the country’s business climate, thereby fuelling the drive to a semi-industrialised, middle-income economy by 2025.
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The rise in half-year net profit from Sh1.64 billion posted in a similar period last year came on the back of net investment income rising 2.5 times to Sh13.27 billion from Sh5.3 billion.
“We are confident in the growth and performance trend that Britam has achieved, supported by its subsidiaries in Kenya and the region. Our business is expanding its revenue base while effectively managing costs,” Britam Chief Executive Officer Tom Gitogo said.
“Our customer-centric approach is fueling growth in our customer base and product uptake, particularly through micro-insurance, partnerships, and digital channels.”
The investment income growth was fueled by interest and dividend income rising 34 percent to Sh9.1 billion, which the insurer attributed to growth in revenue and the gains from the realignment of the group’s investment portfolio.
Britam also booked a Sh3.79 billion gain on financial assets at a fair value, compared with a Sh1.8 billion loss posted in a similar period last year.
The increased investment income helped offset the 12.7 percent decline in net insurance service result to Sh2.13 billion in the wake of claims paid out rising at a faster pace than that of premiums received.
Britam said insurance revenue, which is money from written premiums, increased to Sh17.8 billion from Sh16.6 billion, primarily driven by growth in the Kenya insurance business and regional general insurance businesses, which contributed 30 percent of the revenue.
The group has a presence in seven countries in Africa namely Kenya, Uganda, Tanzania, Rwanda, South Sudan, Mozambique, and Malawi.
Britam’s insurance service expense hit Sh13.6 billion from Sh11.3 billion, while net insurance finance expenses rose 2.6 times to Sh12.3 billion during the same period.
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