Revenue body overwhelmed by taxpayers

 No wonder taxes have been hovering in the trillions of shillings in recent months. This can be observed clearly as you enter Tanzania Revenue Authority’s (TRA) domestic revenues head offices as well as those in the districts.

 

The Guardian made observation at the authority’s domestic revenues offices on Monday and Tuesday this week where businessmen and women in Ilala, Temeke and Kinondoni districts lined up in large numbers to pay government dues.

 

The crowded TRA taxpaying offices  was enough evidence that tax compliance was on the increase.

 

TRA Director of Taxpayer Education Richard Kayombo says despite such a heed, March is the deadline for the first quarter of income tax payments.  

 

“We are setting up additional offices in each district of the city to ease taxpayers’ burden, this will also ease congestion in district offices” he said.

 

He said offices have already been set up in Tegeta, Kimara and Manzese for Kinondoni district, Kariakoo for Ilala district as they plan to launch another office in Upanga area.

 

As for Temeke district, he said new tax collection offices have been launched in Kigamboni and Tazara areas mainly for motor vehicles.   

According to him, TRA plans to open up more tax collection centres in the near future.

 

However, the majority clients interviewed by the guardian were shocked at the authority’s business assessment trend saying the tax rate were too much for them to handle.

 

 “I think this is why so many people fail to rightfully pay taxes” said Solomoni Kiango as this paper sought for his opinion with regards to the authority’s tax assessment on their business.

 

Kiango who owns a barbershop in Tabata, Ilala district had his business assessed with an annual income tax payment of over Sh800,000.

 

The guardian later learnt that even new businessmen entrants had been caught in disbelief with the way income assessment is being done, as  business people are required to pay an upfront tax prior to setting up their businesses.

 

The Guardian also noted most clients packed at the offices as they wait for hours without being attended due to an overwhelmed clients were new waiting to have their businesses assessed to enable them pay their dues. 

 

TRA targets to collect at least Sh2tln monthly and the taxman managed to collect Sh1.79 tln in January, up from Sh1.4tln collected in December last year.

 

This collection was against the previous administration’s average of Sh900bn a month.

The collected tax is being allocated towards the improvement of social services, including free education, health and infrastructure such as the construction of roads.

 

The most regrettable encounter in many TRA offices however is lack of a clients’ waiting lounge as some customers could be spotted sitting on tables as they waited for their turn, indicating TRA had not prepared itself for an influx of taxpayers.

 

Some clients said they had already spent the whole day at TRA office at Shaurimoyo and Lindi Streets in Ilala district without being attended to.

 

“TRA should have arranged for a customers waiting lounge. We can’t manage to stand here for the whole day as we wait to be served,” an old woman was heard telling one of the officials, who humbly offered the woman his seat.

 

He had to pay a quarter of that amount in the first quarter of the year before he commenced his business. Without it, he would not be issued with a clearance certificate that would enable him to obtain a business licence from relevant authorities, for which a trader pays a fee. 

 

Those seeking documents to sanction their businesses they are supposed to pay between Sh45,500 and Sh500, 000 as the first of four income tax installments before commencing their businesses in spite of the fact that the first quarter lapses on March31, this year. 

 

“This is not a business-friendly regime. In real terms, it’s a forced or an imposed tax and with the current government, doing unjustified business very risky,” Christian Asenga, who operates a lodge and liquor business in the city, said. 

 

Normally, tax assessments needs to consider various factors including the nature of the business, its location and the amount of capital injected.  

 

Nevertheless, TRA Director of Taxpayers says there is always room for taxpayers who are not satisfied with tax assessment to negotiate.

 

“Unsatisfied taxpayers can appeal to the director general after which a review would be made and a mutual decision reached,” Kayombo said.  

 

“These opportunities are there to clear those concerns from taxpayers and they are often fast-tracked,” he added.    

 

Though overwhelmed by clients, even their computer network could not respond to the particular need. A TRA official complained about serious inefficiency of the network, which performs very slowly as people surrounded him for service. 

 

The officer, who preferred anonymity, told this paper that TTCL was the official network provider and that the network problem was not new. 

 

“This is a challenge we have to accept, although it’s not peculiar to us. You know, having more than one supplier is really costly. Nevertheless, we have a back-up in case of any serious stand-off,” Kayombo said.  

 

TRA offices in Ilala, Kinondoni and Temeke districts are not only facing office space challenges, but there is also lack of reserved vehicle parking for clients, causing inconvenience for motorists.  

 

Despite talking about it as a challenge, Kayombo said it remains a challenge to get a parking lot in the congested city. However, this can be possible on its outskirts. 

 

Interestingly, there were clients with mature businesses who confessed that it was their first time to visit any TRA office for tax payment. However, since the coming into power of the current regime, it has become somewhat difficult to do business without complying with relevant rules. 

 

“To be frank, I have been in the logistics business for almost seven years without any operational snag. But now it has become so difficult as anyone you do business with needs to ensure that you have all required documents and that you pay taxes,” said one of the TRA clients in queue for a clearance certificate.      

 

The government expects to collect more than Sh1.4 trillion in taxes and non-tax revenue this month as it strives to gradually cut on donor dependency and reduce budget deficit.