Tanzania: Electronic Stamps Boost Revenue Collection - TRA

Utilisation of electronic tax stamps (ETS), management system on goods subjected to excise duty has increased revenue collections and widened the tax base, the Tanzania Revenue Authority (TRA), has affirmed.

Speaking at the Farmers' (Nane nane) exhibition at Nyakabindi grounds here, the TRA's Taxpayer Services and Education Officer, Mr Godfrey Kumwembe, said the electronic system enables TRA to detect exact quantity of products subjected to tax and hence help to curb evasion.

Mr Kumwembe explained further that the tax collector plans to introduce an online Application (App) to be dubbed "Hakiki Stempu" which will enable consumers to find out whether electronic stamps imprinted respective goods are genuine.

In a separate interview, an economist in the Ministry of Finance and Planning, Mgonya Benedicto, said the application of ETS and the associated App to verify the stamps through Smartphones will help to curb unscrupulous traders who hitherto used forged paper stamps.

"Anyone with a Smartphone will be in a position to verify authenticity of electronic stamps imprinted on all excisable local and imported products. This will enable the government to tap requisite duties and taxes," the official explained.

The first phase of rolling out ETS commenced on January 15, this year, and it covered alcoholic drinks and cigarettes, putting to an end the use of physical paper stamps on such products, whose use was been linked to tax evasion and counterfeiting.

Just recently, the Commissioner General of TRA, Dr Edwin Mhede, announced commencement of the second phase of ETS to cover carbonated soft drinks and bottled water, among other locally produced and imported products.

The TRA's Director of Tax Payer Services and Education, Mr Richard Kayombo, told 'Daily News' in a past interview that 45 e-machines for ETS have been installed at 19 carbonated drinks and bottled water factories.

A Swiss firm Société Industrielle et Commerciale de Produits Alimentaires (SICPA SA) through its subsidiary SICPA Tanzania won the contract for supply and installation of the system for TRA.

"Based on tax returns filled by producers of excisable products, revenue collections increased to 28.782 billion between January and April, 2019, compared to 24.735 billion during the corresponding period in 2018, this translates to an increase of 16 per cent," Mr Kayombo.

During the first phase which kicked-off on January 15, 2019, a total of 62 producers and importers were enrolled for the system where 44 e-machines have been fitted in 23 factories.

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