ZANZIBAR unveiled her 2022/2023 economic recovery and life improvement budget here on Tuesday, with enhancement of social services topping the priority list.
Minister of State, President's Office, Finance and Planning Dr Saada Mkuya Salum moved the 2,590.3bn/- revenue and expenditure plan for the next fiscal year, identifying other priorities as bolstering the use of electronic systems in the government and improvement of public servants' welfare.
Dr Mkuya said the government has budgeted 588.61bn/- to human development through investment in health, education and water sectors in the country.
She said the government is determined to strengthen the uses of electronic systems in the government services, with over 12bn/- budgeted for the task.
The government has allo- cated over 628bn/- towards the welfare of public servants, with ward councilors lined up for salary receipt to improve their performance, the minister told the house.
She said the government through its medium development plan will inject in the econ- omy 798.19bn/- to execute 13 multibillion strategic projects, which will transform Zanzibar image, boost the economy, enhance social services and create jobs for the islanders.
The budget also aims at putting in place firm good governance foundations by strengthening the human rights administration institutions and supportive infrastructure.
Promotion of Zanzibar tourism attractions to entice more tourists for foreign currency earnings and job creation appear on the government's top budgetary priorities as well.
Minister Mkuya said the government has devised strategies to develop a stable and predictable taxation regime that encourages voluntary tax payment, employment growth and strengthens tax management and collection.
She announced value added tax (VAT) relief on electronic receipt issuing machines and receipt printing papers to widen the machine use scope and pro- mote their applications in business transactions.
The minister also announced plans to introduce income tax and VAT on digital services, saying the move seeks to sim- plify registration procedures for non-resident digital services providers.
Professional services also come under VAT scope, with all registered professionals required to collect VAT on their services, the minister said, arguing that despite an increase in professional service providers, there is insufficient information on their operations, which impedes collection of government revenues.
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The government further proposes 100 per cent VAT relief on non-strategic investors in domestic procurement of materials during their investment construction, Dr Mkuya said, arguing that the move seeks to promote domestic purchases by investors.
The government also reduced by 25 per cent stamp duty on commercial vehicles to stimulate accountability, voluntary tax payment and increase efficiency in tax management and collection.
Vehicle's private plate number registration fee has decreased from 15m/- for five years to 5m/- over three years to encourage more islanders to use the opportunity while mo- tor vehicle registration fee has increased by 20 per cent.
Smokers and spirit drinkers will have to pay more in the newly-proposed infrastructure tax of 10 per cent on cigarette and spirit importation and trans- fer.
From the new tax, the government eyes 3.5bn/- collection, with half of it invested in infra- structure development while the remaining will be directed to the economic stabilization fund.
The minister said the government will introduce legal reforms, widen the tax base and enhance institutional efficiency in revenue collections.
She reaffirmed the government's resolve to introduce firm systems for stable and predict- able taxes; promote voluntary tax payment and increase employment.
Dr Mkuya boasted of de- clining donor dependence from 4.3 per cent in the current finan- cial year to a mere 2.7 per cent next year, explaining that out of the 2,590.3bn/- proposed budget, only 71.09bn/- is expected from the development partners in the form of grant
