10 December 2018

Tanzania: Magufuli - This Is Why We Shut Down Bureaux De Change

Photo: Daily News
Tanzania President John Magufuli.

Dar es Salaam — President John Magufuli has today December 10, 2018 clarified on the closure of bureaux de change in the country, explaining that the main reason was tax evasion by the traders in currencies.

The President clarified during the working session between him and the Tanzania Revenue Authority (TRA) and regional commissioners that: "In that intervention we found that one licensed bureau might have at least seven unregistered bureaux."

Dr Magufuli added that in 37 bureaux de change, only one was registered.

He further noted that: "When they tried to exchange money using the bureaux there was no indication at TRA that the amount was transacted... this shows that there was no connection between TRA and bureaux de change."

"You can exchange any amount of money you want in our bureaux without even being asked why the money is entering the economy," he said, adding that the culture affected the economy. He said the situation was different in other countries in which people were scaned, asked why they were in the country and were given a limit to the amount of money they could exchange.

For his part, the Bank of Tanzania (BoT) Governor, Prof Florens Luoga, said that the central bank was working on ensuring all beureaux were licensed. He explained that there was a need for more bureux in areas with many foreigners to work on a system in which all foreign payments would be conducted in banks to avoid fraud.

"We are working with the ministry of Finance to ensure all import payments in the country must be through banks," he said.

In November, this year, the BoT conducted impromptu inspections that started with Arusha-based bureaux de change that led to the subsequent suspension of their operations for breach of rules and regulations.

The directives were followed by the suspension five commercial banks from participating in Interbank Foreign Exchange Market (IFEM) for one month, effective from November 23, due to violation of the law.

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