Chairman of the Public Accounts Committee (PAC) Mr Zitto Kabwe
In Summary
Currently, half of the revenue collected by various
government ministries and departments in non-tax collections does not
even reach the Treasury due to widespread doctoring of receipts,
corruption and outright theft.
Dar es Salaam. The use of electronic receipts in
the non-tax government collection would generate a whopping Sh700
billion for the Treasury, Mr Zitto Kabwe, the chairman of the Public
Accounts Committee (PAC), has said.
Currently, half of the revenue collected by
various government ministries and departments in non-tax collections
does not even reach the Treasury due to widespread doctoring of
receipts, corruption and outright theft.
But electronic receipting would change all that
and increase revenue for the government whose dependence on foreign aid
to fund the national budget is still significant. In the past seven
years, for example, the government received $5 billion (Sh8 trillion)
from donors through the general budget support. If electronic receipting
is fully adopted, the government would collect Sh5 trillion additional
revenue in the next seven years, according to calculations done by The
Citizen.
Electronic receipting has already increased the
collection of the Value Added Tax (VAT) by 60 per cent from an annual
average of Sh500 billion to Sh800 billion.
MPs have resolved to push for the introduction of electronic receipt to increase government revenue.
This was one of the resolutions reached at a
week-long seminar in Bagamoyo that brought together three parliamentary
committees- Public Accounts Committee, Local Authorities Accounts
Committee, and Budget Committee that oversee public finances and the
Controller and Auditor General (CAG).
“We hereby urge the government to immediately
start collecting revenue from the central and local government sources
using electronic devices,” says the statement.
This will seal the loopholes currently being
exploited by crooked officials to steal using the paper receipts,” a
statement released at the end of the seminar notes.
The MPs also advised the government to purchase goods and services only from suppliers that use electronic devices to pay tax.
In a separate statement, Mr Kabwe said that if electronic devices were to be put in use, government revenue would double.
“I have gone through Volume I of the 2013/14
Budget book on financial statement and revenue estimates and found out
that more than Sh1 trillion is expected from various ministries and
local governments. However, if electronic receipts would be used, the
revenue would double,” Mr Kabwe noted.
The 2013/14 Budget requires Sh18.2 trillion to fund recurrent and development expenditures.
An increase in revenue collection would reduce the need for the
government to impose taxes on basic necessities to bridge funding gaps,
Mt Kabwe added.
“The government is expected to collect Sh16
billion from traffic notification fees this financial year; however,
that is only about 30 per cent of all traffic notification fees the
police collect. Electronic receipt would significantly increase
revenue,” Mr Kabwe noted.
Meanwhile, the public finance oversight committees
want a special audit to be done to determine the full amount and extent
of the national debt.
The data available from the Bank of Tanzania (BoT)
shows that the total national debt stock is Sh19 trillion, which
includes $12 billion (Sh19 trillion) as external debt and Sh5.64
trillion as domestic debt.
“A special team drawing members from the
parliamentary committees overseeing public finance, the BoT, the
Treasury, and the CAG should be formed to audit national debt,” the
committees’ statement says.
A special institution should also be formed to monitor and oversee government debt, it further says.
The government has maintained, in various reports,
that the national debt is sustainable after a good chunk of it was
written off under the Heavily Indebted Poor Countries initiative. But
abuses have happened in the past involving the payment of bogus debt
instruments.
The most notable has been the External Payment
Arrears (EPA) account held at the BoT. In the 2005/6 financial year, the
government lost about $131 million in dubious payments to local firms.
Some of the beneficiaries in the scandal were
prosecuted but the dubious payments exposed weaknesses in monitoring the
national debt.
source: The citizen
source: The citizen
