Tanzania: MPs to Approve 2016/17 National Budget On Monday

The National Assembly resumes here this morning after a weekend recess, with Members of Parliament expected to approve the 30trn/- 2016/17 national budget.

MPs are eagerly waiting to hear the government's response to their outcry over the proposed contentious tax on their gratuity. Finance and Planning Minister Dr Philip Mpango presented the development focused fiscal plan of the government some 12 days ago, enumerating a number of austerity measures to control spendthrift in the public sector.

The lawmakers had six days to debate the budget proposals, with almost all MPs disapproving the proposed five per cent tax on their gratuity as not only unjustifiable but also unfair. Some MPs, during the debate, denounced the taxation, demanding that all politicians, including the president be taxed instead of singling out only the lawmakers.

Analysts say that, given his commitment to taxation drive to boost the government collections, President John Magufuli may decide to commit his earnings to similar tax to weaken the legislators' argument of discrimination.

Excessive taxes on agricultural produce were among the areas that attracted heated debate, with MPs pressing the government to scrap the nuisance tariffs on peasants.

They charged that in Tanzania peasants pay taxes at the rate of over 70 per cent of the gross prices of their agricultural produce, describing the tax regime as exploitative and unfriendly to the struggling poor peasants.

The proposed 18 per cent Value Added Tax on tourism services was also strongly opposed as counterproductive to the country's already uncompetitive tourism industry. After approving the budget through open votes, the Appropriation Bill, 2016 will be presented.

The National Assembly will complete the budget activities with the Finance Bill, 2016, on Wednesday, sparing seven days for the question-answer sessions and presentation of Government Bills, before adjourning the parliament next Friday

Source: Tanzania Daily News