The Tanzania Revenues Authority (TRA), has announced that from 1st July 2021 the requirement of 15% import tax on sugar for industrial use will be waived.
The decision follows the TZS 36.68 trillion 2021-2022 national budget recently approved that seeks to improve the business environment in the country.
Alphayo Kidata the Commissioner-General of the Tanzania Revenues Authority (TRA), made the announcement that from 1st July 2021 the requirement of 15% import tax on sugar for industrial use will be waived
According to the speech by the Tanzanian Minister for Finance and Planning, Dr. Mwigulu Lameck Nchemba, presenting the budget to parliament, this measure is intended to promote competitiveness and increase liquidity of domestic industries.
In addition, the introduction of the Electronic Tax System (ETS) will be used as a mechanism to track company’s production and verify the use of industrial sugar.
However, non-compliant traders will be subjected to the previous measure on top of other existing legal measures.
The duty paid on sugar imports was increased from 10% to 25% in June 2015, in a bid to boost the competitiveness of locally produced sugar.
Those importing sugar for industrial production (food, beverage and pharmaceutical production) were promised a 15% refund on their import duties, but this has not fully materialized.
In 2018 the Confederation of Tanzania Industries (CTI) raised concerns over long outstanding import duty refunds and allocation delays for industrial sugar imports into the country.
In this regard, Kidata said that in 2020-21 TRA was supposed to reimburse TZS 57 billion to importers but so far they have paid out just TZS 37 billion and hoped to reimburse the remaining TZS 12 billion in July 2021.
The Tanzania Sugar Industry Tanzania’s sugar annual demand is estimated at 710,000 tonnes in 2019
In April 2020, the Tanzania Investment Centre (TIC) issued a notice inviting domestic and foreign investors to develop sugarcane and sugar processing plantations in the Kigoma region in northwestern Tanzania.
Meanwhile ,The parliament of Tanzania has approved the Central Government Budget of TZS 36.68 trillion for the financial year 2021-2022 with 94% of the Members of Parliament (MOPs) voting yes.
The total budget for 2021-2022 has been increased by 5% from TZS 34.88 trillion allocated in the 2020-2021 budget.
The budget will be mainly financed by domestic revenues for TZS 26.0 trillion (71%), grants from development partners for TZS 2.9 trillion (8%), domestic loans for TZS 5.0 trillion (14%), and conditional external commercial loans for TZS 2.4 trillion (7%).
Most of the budget (63%) will be allocated for recurrent expenditure, while 37% will be destined to development projects.
The key beneficiary economic sectors of the new budget will be construction, energy, and infrastructure.
Flagship projects to be financed include the construction of the standard gauge railway (SGR), the construction of Julius Nyerere Hydropower Project (2,115 MW), strengthening the national air carrier Air Tanzania, and the construction of the Uganda-Tanzania crude oil pipeline.
In addition, TZS 571.6 billion are expected to be spent in the tourism sector and TZS 233.3 billion in the health sector for the purchase of medicines.