Recently Policy Forum did an analysis to assess the extent to which Tanzania’s mining fiscal regime is aligned with the Africa Mining Vision (AMV). The AMV, which was adopted by the Heads of State and Government of the African Union (AU) in February 2009, serves as a regional policy tool to guide the development of mineral resources in Africa.

The tax system can directly reduce inequality by redistributing income from rich to poor, by taxing the rich more heavily and giving the government revenues to spend on public services. In Tanzania, there is a challenge of a large and increasing informal sector which has often gone untaxed hence subjecting a higher tax burden on the few within the formal sector. This in a way contributes to inequality because the informal sector partly constitutes relatively High Net Worth Individuals (HNWIS) whose incomes are not often subjected to tax.

CSOs in Tanzania have called for increased clarity of the division of functions and responsibilities of the central and local government administrations in the country if decentralisation by devolution is to work. This includes clarification on property registration and valuation responsibilities, and obligations on the maintenance of property registers and revenue data.

The 2018 Financial Secrecy Index, a tool for measuring global financial secrecy and secrecy jurisdictions, presents some worrying signs for the emerging economies in Africa and threaten to potentially undermine the sustainability of their development trajectory. Tanzania scored a high secrecy score of 73. Surprisingly, even with these attractive secrecy policies, it is only recently that the jurisdiction has been brought under the spotlight.

For a country like Tanzania to meet its inclusive development objectives and realistically fund essential services such as provision of clean and safe water, healthcare, education and infrastructure, it needs reliable sources of own revenue including from taxes. Moreover, an economy needs a tax policy that redistributes wealth to address inequality including redressing gender gaps within society.

The Executive Director of Kepa, a Finnish NGO network, Timo Lappalainen (left) and Communications Officer Mirka Kartano (first right) with Policy Forum Coordinator, Semkae Kilonzo (second left) and Kepa Tanzania Country Director, Bakar Khamis Bakar (second right).

Although Tanzania is now acknowledged as one of the fastest growing economies in the world, this progress has not translated to major changes in the lives of ordinary Tanzanians. The reasons for this are many but tax incentives, tax evasion and avoidance and illicit capital flows to tax havens have been pinpointed as some of the factors that limit the country from raising adequate funds to improve service delivery.

People living in extreme poverty hesitate to pay taxes for their development because they think that the government fails to fulfil its responsibility of solving their development challenges. The challenges include poor infrastructure, lack of medical care in the village dispensaries, poor education system and lack of clean water. That is said today in Dodoma by Hon. Mendrad Kigola (MP) during the follow-up meeting of the stop the bleeding campaign coordinated by Policy Forum (PF) in collaboration with Tanzania Tax Justice Coalition (TTJC).

The Policy Forum monthly breakfast debate on September 29th, 2017 dedicated to discussing the Concealed Opportunities of the Informal sector in Tanzania. The debate entitled “The Power of Tanzania’s Informal Economy: Unveiling the Concealed Opportunities”, was presented by William Madiwa from Tanzania Trade and Economic Justice (TTEJF).