25 April 2018

Tanzania: Grape Growers Face Unfair Crop Taxation

Dodoma — PRESIDENT John Magufuli has directed government authorities and requested the office of the Speaker of the National Assembly to assess and make amendments on taxes which are a burden to farmers.

Last year, the government reviewed and nullified at least 84 taxes which were seen unfriendly to cash crops; coffee and cashew nut growers. In addition, seven other taxes that were limiting the fisheries sector development were also axed.

"If we have managed to review all such taxes why not the remaining ones which retard development in the agriculture sector," he said in Dodoma this week.

The President said ministry officials should work along with the National Assembly to complete the task. His directives followed concerns raised by Dodoma Urban MP Mr Anthony Mavunde (CCM) that grape farmers in the central region were in a huge dilemma to secure markets of their produce.

The lawmaker and Deputy Minister in the Office of the Prime Minister claimed that such taxes had pushed away buyers and big investors over what they claimed to be skyrocketing costs of production. Officials say a litre of raw grape juice is charged 3,215/- which is seven times higher than a kilo of sorghum used in the making of a beer that is taxed 450/-.

Observers say such difference had in turn made the local wine brand more expensive than the imported wine from South Africa.

Mr Mavunde says at least 73 tonnes of grapes have rotten owing to lack of market and its likely more grapes will lose markets should there be no immediate action to amend the taxes that frustrate the wine producers.

Dodoma has nine wine factories, two being the largest wine producing factories. It is not clear how much grapes are produced annually in the region but the government announced that another million dollar wine factory is set for construction in the region this year.

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