The Chairman of PAC Zitto Kabwe (Kigoma North-Chadema), raised concern as well that the delay to enforce the VAT Act of 2014 would deny the government more revenues through the VAT special reliefs during the current year.
Tanzania Revenue Authority (TRA) Commissioner General Rished Bade told members of the parliamentary committee that VAT relief accounted for about 676bn/- on the exempted taxes during 2013/2014 up from 571bn/- in 2012/2013.
?It is true tax exemptions during the year under review increased despite the directions by PAC to cut down the waiver. The increase was due to huge projects that were donor funded and hence enjoyed exemptions.
?Exploration for gas and oil as well as construction of the pipeline to transport natural gas from Mtwara to Dar es Salaam and construction of the Kigamboni Bridge are among projects that benefited from the waiver and thus the increment,? Mr Bade explained.
The explanation by the TRA boss followed a question by Special Seats MP Easter Matiko (Chadema), who had raised concerns that the exemptions have been on the increase each year, denying the country billions of money in revenues.
Back in 2012, the PAC directed the Controller and Auditor General (CAG) to conduct a special audit on the exemptions to ascertain whether the waivers were beneficial to the country.
An official from the CAG office told members of the committee that the audit was being finalised and that it would be handed to the committee by January 22, this year.
?We are now conducting a quality review on the audit report and it will be ready by January 22,? the official stated. According to Mr Bade, exemptions to multinational companies engaged in exploration of natural gas and oil both offshore and onshore the Indian Ocean stood at 100bn/- while projects undertaken by parastatals enjoyed tax waivers to the tune of 147bn/- during the fiscal year under review.
?The good news is that the new VAT Act which is yet to be enforced has lifted exemptions on a number of areas and this will eventually cut down the rate of tax waivers,? the TRA boss assured the parliamentary committee. On the other hand, Mr Zitto said the committee would write to the Speaker of the National Assembly in regard to over 1.7trl/- tied up revenues due to pending cases at courts.
?This is a lot of money; we will write to the Speaker so that she can arrange a meeting with Prime Minister and Chief Justice to see how these cases can be resolved.
?It is ideal that these cases are settled; if we win we will get our shares of the taxes and if we lose be it but it is important that these issues are solved once and for all,? remarked the vocal parliamentarian.
Meanwhile, the TRA has during the last two years managed to collect 382.2m/- from artistic works following formalisation of the industry.
Mr Bade said the revenues are those musicians and film makers whose works were formally sold to the market bearing the TRA tax stamps, which enables the government to collect requisite taxes and at the same time curb piracy of artistic works.
By ALVAR MWAKYUSA, Tanzania Daily News