2013/2014 Government Budget: What is your opinion? The budget for the year 2013/2014 has been announced by the Minister responsible for Finance, and Economic Affairs. A package of new measures for collecting more revenue and reduce government expenditure have been identified including; holdin ...Click here to read more

2013/2014 Government Budget: What is your opinion? The budget for the year 2013/2014 has been announced by the Minister responsible for Finance, and Economic Affairs. A package of new measures for collecting more revenue and reduce government expenditure have been identified including; holding down unnecessary government expenditures on cars, telephone and the like. The budget also and highlighted several new sources for revenue collection, slashed income taxes rate to reduce the tax burden to workers etc. However, like in the previous ones, government increased taxes on fuel, cigarettes, soft and hard drinks. Fiscal policies to curb tax evasion through which government will collect more tax revenues for strengthening social and economic infrastructure were also announced. Moreover, the 2013 /14 budget is said to draw its priorities in the first five year Development Plan. Hence the budget priorities areas are as follow:

1. Infrastructure: - energy infrastructure; transportation (roads, railway, airports and marine transport); ICT; clean water and sewerage and irrigation;

2. Agriculture: - including food and cash crops, industrial raw materials, livestock, fisheries and forestry.

3. Industries:- which use domestic raw materials and value addition, heavy industries for fertilizers and cement, factories in the Special Economic Zones, electronics and ICT;

4. Human resources and skills development by emphasizing science, technology and innovations;

5. Developing tourism, trade and financial services; and

6. Social services: improve the availability and quality of social services.

Based on the 2013/4 Budget estimates, as forum members let us discuss this budget line with the following questions:

i. Do the estimates address issues that touch the lives of many common people? And does the budget proposal meet what most people expected in the 2013/14?

ii. Does the current budget proposal reflect the commitment of the government to mitigate high costs of living to the citizen?

iii. How different is the current budget from the past ones? Does the budget proposal feature other priorities identified in MKUKUTA, MKUZA and Vision 2025 as we aspire to be the middle income country by 2025?

iv. What are your general opinions regarding the 2013/14 budget proposal in relation to poverty alleviation and well being of the people?

I am writing to invite you to a public seminar to be held at ESRF Conference Hall on Tuesday 5th November 2013. During the seminar, Prof Charles Gore from University of Glasgow will make a presentation on "Economic Development and Generalized Poverty Reduction: Key Lessons from past experience". The seminar will be held from 2pm to 4pm in the afternoon.

For more details on the seminar including biography of the presenter please visit http://www.esrf.or.tz/ebrief/023.html. We look forward to your acceptance of this invitation and participation in the meeting.

Please confirm your participation through Ms. Jacqueline Mwijage email address: mwijage@esrf.or.tz or call on 0713 216856/0754780133

Just to respond to an issue you have raised in relation to standards of education in Tanzania – which you have indicated that you don’t know. Standards of education down here have been deteriorating sharply over the past say 20 years. The worst case scenario was this year when we had mass failures in 2012 secondary examinations. Since 2000 we have managed to increase students enrollment at all levels of education from primary to tertiary but then that achievement has come along with an opportunity costs in terms of deteriorating performance. As you have seen in the brief synopsis that Hassan has developed for Tanzania Human Development Report 2014, one of the background paper we are preparing for this study is on “What lies behind further decline in education standards in Tanzania?”. In this paper we want to dig deep to uncover underlying reasons – not the usual petty reasons like lack of textbooks, lack of classrooms, lack of teachers etc.

I hope that THDR 2014 will make an important intellectual contribution to understand dilemmas facing education sector in this country and how to reverse experiences of the last decade. I think the issue of capacity building of trainers of trainers i.e. teachers of teachers is very interesting because often time we tend to focus on teachers forgetting teachers of teachers. I suppose authors of this background paper will have to dig deeper on this direction to know what is not going in teachers colleagues.

Kwa watanzania wengi mitaani lengo lao ni kuhakikisha kuwa waheshimiwa tunaoongoza kufanya maisha ya mtu wa chini kuwa magumu zaidi tuelewe mwisho wa siku maisha yetu pia yatakuwa ya shida. Ongezeko la kodi ya simu haliwapi shida walionacho bali ni kilio kwa wengi ambao kipato kidogo. Juhudi ziwe za kutenda haki kwa maendeleo ya wote. Badala ya viongozi kuongeza uzalishaji, kila mwaka lengo ni kuongeza kodi kwenye vitu vile vile km: soda, bia, sigara road, licence n.k., Wanyonge wataacha kutumia hivyo vitu na hatutapata fedha. Kwa mfano rafiki yangu alikuwa na line tano za simu - kutokana na kodi ametupa tatu na kubakia na mbili.

B.Kaale

The collection of the 1000 tax is to be done at source (through Telco's). This is why they are up in arms on account of the fact that while they have these number of people having lines but in reality the numbers are not being used but since they are regiatered they are taxable. In the short run its the Telco's who will suffer unless they decide to terminate a number that isnt used after a month. (For instance: I have an airtel number which i rarely use or replenish credit but its recorded at Airtel as active). Absurd way of taxation.

Anthony Gikuri

Kizumbi Campus

Moshi University College of Cooperative and Business Studies

P.O.BOX 469

SHINYANGA

Tanzania

Mobile +255713634382/+25589448244/+255768805441

Website: www.muccobs.ac.tz

Regards,

Marisham

Two, is there anyone who is against the purpose/the intuition behind planned expenditure of this tax? What is the alternative source of revenue that will fund this activity in case we are against the proposed tax considering tax base of most of underdeveloped nations, Tanzania included.

Otherwise if we don't want to emancipate our kids from ignorance (as the tax is expected)to fund education sector)they will inherit our position in this group of walalamikaji. We need to change our focus instead of keeping complaining about mining contracts which there is minute possibility of amending or not honouring them let us think forward on how nation will benefit from the future contracts. By the way if one will make an informed analysis will note that the contract we are lamenting on them since 90s does not amount even 10% of mineral deposits in Tanzania. Since now we have the mining policy, we made input in gas policy at least we know what we want as a nation. All in all let us propose the alternative source, a new one, where we can draw fund for education sector.

Why should investing MNC's be exempted from taxes, levies, fees and duties in millions of shillings? Why should investing laws favour the rich with tax holidays?

CDNKassala

Sallu Johnson has brought fresh thinking into this thread and I am thoroughly delighted with and thank him for it. Indeed what is wrong with a "poor" person who can afford a cellphone contributing to a fund which will ultimately finance common goods and services - runal rural electrification, water supply, healthcare and what else have you? If some rural folk is so poor s/he cannot afford a cellphone then of course s/he is outside this tax net. By definition therefore the poorest of the poor are automatically exempted from it. But how poor are the "poor"?

I was in Mbozi this week (20-24 July) for the funeral of one of my loved ones and the poverty I saw among the ordinary folk is not as dire and abject as the pro-poor activists in this conversation would want us to believe. I safely estimate that 60-70% of the several hundred adults at the funeral had cellphones of every description and standard! Unlike in the old times when I was growing up there, all of them were wearing shoes (used or new is not the point!). I would not describe any one of them as attired in tatters either.

The motor cycle (bodaboda) is by far the commonest mode of rural transport there now and the youth involved are doing thriving business. I estimate that 30-40% of the mourners coming from afar used bodaboda to and from the funeral. Only ten years ago nobody imagined that there would be such fast and instantaneous exchange of information through the cellphone and such fast movement of people and goods via means like the bodaboda. Multiply Mbozi's experience 10,000 times and you get some idea of the silent revolution going on in this country!

So let us be realistic - Sallu's point makes a lot of sense to me.

Cheers!

Nikubuka Philemon Shimwela

Hebron

from we 'Microfinance financial services providers....SACCOS and VIKOBA' we were in the move tointroduction of Mobile Money Transfer (MMT). This were to involve a number of SACCOS/VICOBA and mobile phone service providers. As from this imposition of of the monthly tax of 1,000 plus other addition money transfer fees will automatically increase operation cost of the service to users. Majority reside in rural and marginalized urban areas. As a result there will be reduction on clients who are MFIs money savers, SACCOS borrowers that want to reimburse loans thru MMT or M-Pesa/Tigo Pesa. Mobile phone users will decline, but not owners! The anticipated Tshs 161.0 bil will be just a wishful income to the GOT... the whole idea of rural financial service infusion will be affected. Mind you starting from this July, the cost of mobile money transfer has increased. Likewise for the urban users like in DSM. One SACCOS staff revealed to me this Monday that, SACCOS members have now resorted to board dala dala to physically come to SACCOS to either deposit or withdraw money as it is cheaper compared to use of m-pesa/tigo pesa services! This will automatically affect to some extent, the quality of loan portfolio of most MFIs. Let us wait and see!

From the figure above and the data portrayed, shows that the sector has been growing on average at above 20% since 2008, but its share contribution to the total GDP of the country has been below 5%. What does this imply? Much of the economic gains from this sector have not been translated into tangible assets to the local people. Huge profits which the companies in this sector have been making to a large extent have been repatriated to parent companies abroad leaving behind very little that is ploughed back into the general framework where you and me can have direct tangible benefits. Before even the government comes with this new tax initiatives it has first to bridge this gap which is too wide (refer the above figure) meaning that these companies are not paying to the government all the required dues. Statistics are telling us this story and hence the government should curb these loopholes first.

Regards

Yonoh

SIM card tax is a controversy. Several questions posed to the legitimacy and the negative consequences of this kind of tax to the already poor majority have not been responded to accordingly by the government. The circumstances around the introduction of this tax are not clear. Why was it not discussed thoroughly in the parliament? Why were mobile phone operators not consulted? But most importantly, why should a very poor person in the village who can only afford Tshs 1,000/ for SIM card credits in a month be charged equally with a wealthy business person who spend over Tshs 100,000/ in same duration? The burden of this tax is unjustifiably unfair. Its consequences include denial of rights of access to information but also unfair distribution of income. If a tax on SIM cards is necessary, there is ground for which to support its regressive effects. Why should the poor be made poorer?

On the other hand; several lamentations, have it that, the government have failed and is persistently reluctant to collect revenue from mining companies and other multinational corporations looting our natural resources for their industrial consumption abroad. The government have also failed to hold accountable her officials for misappropriation, corruption, theft and bad contracts, costing the government billions of dollars every year. The government have also failed to cut excessive spending on administration and leisure, international travels, etc.

My humble submission!

Simon Meigaro.

South Korea did it, and they went further down to contribute wholly from their own possession i.e. golden bangles,earings and the like to enable their country emerge from a deep recession.

I am also not confortable on the statistics being offered that 36% of users spend less than a 1,000/- per Month. I am sure the comment does not come from someone who has been to most corners of our country where similar to China we have affluent communities almost in every region and the growing middle class.

Has he seen countries which are really termed poor, such that a meal a day is a hassle leave alone the kind of shelter one is able to provide for his family!

No where in Tanzania you will find squarters that equal what we have in the Mathare Valley or in the outskirts of most South African big cities!

Thanks...

Sallu E. Johnson CMILT(UK)

However...Let me ask you a crazy question: Has anyone of us found out how much of the preceding budget (development/investment budget) was transferred up to end May 2013? I think, from what we have it was less than 35% in most of LGAs. So what is the use of raising hope...if the government categorically knows it will not be able to transfer the money to LGAs in time?

This saddens me! I think we shouldnt be talking about the budget (forward looking) without reflecting back on the practice. Has the money been a problem in Tanzanian government? I doubt this. Why we are informed this year, TRA has been able to collect over 100% of the target even before year end!!!!

. Was the target realistic? Whatever the answer, we know if the money collected was over and above the estimates, and were expected to spend within the budget, then we should have extra money around (hela za uchakavu) to cater to eventualities, and not be struggling to transfer money down to LGAs

Now coming to the realty....well, I LOVE SECTOR YA KILIMO. I think we should have been told the STORY ON AGRICULTURAL DEVELOPMENT BANK. WHERE IS IT? HAS THE MONEY BEEN ALLOCATED, IS IT OPERATIONAL? HOW MUCH HAS BEEN ALLOCATED OVER THE LAST 3 YEARS AND WHO ARE THE BENEFICIARIES? WHAT IS THE FATE OF EMERGING SMALLHOLDER FARMERS (YOUTH IN PARTICULAR) AND LOCAL BUSINESS MEN/WOMEN?

Dont we see the NISHATI vijijini as a hoax? I mean I do not see the collection from petroleum to benefit umeme/nishati vijijini A friend of mine from EWURA said on average we (Tanzanians) consume at least 5,000 tones of petrol. If you multiply this by a thounds to get litres.....and then multiply this by Tzs 120/litre, and then multiply it with a number of days in a year (366) it is a hell of money! Do we know the cost of such projects in rural areas? Do we know well such projects? Anayekamuliwa ni nani if not the fellow employee and farmers who moil and toil to see ends meet and yet hardly benefit from such a sweat.

Do not quote me wrongly friends, but I just wanted to bring a different angle on this discussion...and for sure these extra kodis will be felt through increased transport costs, which automatically increases gharama za vipuri, mbolea na pembejeo na mwisho kupunguza kipato cha mkulima

Tchao