Tanzania to Broaden Tax Base Through Electronic Receipts

Money Transfer

Dar es Salaam — The Tanzanian government expects to collect 600 billion shillings ($370 million) a month after a new tax system expanding the use of electronic tax register (ETR) machines takes effect on May 15th.

Currently, the government collects 400 billion shillings ($250 million) per month in taxes. ETR machines tabulate sales receipts at the close of each business day and electronically send that data to the Tanzania Revenue Authority (TRA) for an accurate tax assessment.

"Under the new system, businesses that earn anything from 14 million shillings ($8,600) to 40 million ($25,000) from now will have to use ETR machines," said TRA Deputy Commissioner for Domestic Revenue Generose Bateyunga. Previously, these businesses could simply estimate their taxes.

Bateyunga told Sabahi that about 200,000 taxpayers have been avoiding paying taxes or underpaying, adding that aid from donors has been decreasing, therefore Tanzania must broaden its tax base to fund development.

In 2010, when Tanzania introduced ETR machines, tax collection improved by 9.6% for the 2010-2011 fiscal year and 23% for 2011-2012. "We are implementing phase two, which will bring on board even more tax payers," she said.