TRA: at the heart of national development

MELKIZEDECK E. SANARE Commissioner General of the Tanzania Revenue Authority

The Tanzania Revenue Authority (TRA) is the body charged with the responsibility of administering the nation’s tax system. Established in 1996, the semi-autonomous TRA has a proven track record of success.
Revenue collection is the core business of the TRA and yields have increased significantly in recent years. Commissioner General Melkizedeck Sanare says that this can partly be explained by the introduction of reforms to rationalize and simplify the existing system and also by the body’s commitment to taxpayer education. “Taxpayer education has been an important factor in helping us to collect taxes successfully. People now understand that by paying taxes they make an important contribution to national development.”
Mr. Sanare explains that without this important groundwork it would have been impossible to have gained popular backing for the introduction of VAT in 1998, a measure that has created a wider tax base and generated valuable revenue to support public services.

Another important element of the work of the TRA is its role in helping to create an attractive investment climate for foreign capital. Working in harmony with the one-stop shop Tanzanian Investment Centre, the TRA has introduced a number of measures designed to encourage outside investment.
In order to encourage investment in strategic sectors such as infrastructure and agriculture, duty on imports of raw materials, capital goods and replacement parts has been removed. Under the VAT regime all exports of goods and services are zero-rated, while there are special deferment terms available for new businesses setting up in the country.
“One of our main aims is to ensure that the tax structure in this country is conducive to investment from both local and foreign sources. We want to make sure they get the best treatment possible,” concludes Mr. Sanare.