President John Magufuli has put a lid on the row over imported edible oil at the Dar es Salaam Port by directing the Tanzania Revenue Authority (TRA) to charge the requisite import duties for clearance of the critical commodity, to avoid its shortage in the market.
He also instructed that all importers who will be found to have under-declared the imports to be dealt with, proposing on the other hand, an amendment of the legislation covering importing edible oil to curb tax cheating.
The Head of State gave the instructions on Tuesday, during an impromptu visit at the port. He was apparently irked by dishonest importers who had been importing refined edible oil and disguising it as crude to evade taxes.
Dr Magufuli directed that besides the normal tax bill, TRA should also slap fines on suppliers who falsely declared that the imported oil was crude while investigations had proved otherwise.
Crude and semi-refined oil attracts 10 per cent in import duty while refined product is charged 25 per cent import duty in addition to 18 per cent in Value Added Tax (VAT). However, some unscrupulous importers have been importing refined oil disguised as crude in order to avoid taxes.
The row on edible oil had set three government institutions at loggerheads for a couple of days, and triggered panic amongst consumers.
Tanzania Bureau of Standards (TBS) and the Office of the Chief Government Chemist had maintained that the stock was crude but officials from TRA maintained that the stock was a mixture crude and refined.
The edible oil had thus remained stranded at the port amid the wrangles by the government institutions, the Speaker of the National Assembly, Mr Job Ndugai, asked the government to come clean on the matter.
A team of experts led by Prof Joseph Buchweishaija, who analysed the oil tanks at the port found out that out of the 43 storage tanks with a capacity of 105,630 tonnes, seven had refined oil while 14 had semi-refined oil. Four of the tanks were storing refined stearin which is used in manufacturing soaps while 18 tanks contained crude oil.
“Based on the findings of the team that conducted the analysis, I am duly directing that the consignment should be cleared at the port after required taxes are paid,” Dr Magufuli said.
President Magufuli was categorical that the seven tankers containing double refined oil should be charged the usual 25 per cent import duty and 18 per cent value added tax as per TRA requirements. On the case of the semi refined oil and crude oil, 10 per cent import duty and 18 per cent VAT should apply as normal.
“I also wanted the team to analyse whether the oil was fit for human consumption and they responded in the affirmative; I don’t want these suppliers to take advantage of the forthcoming Holy Month of Ramadan to feed people on unsafe stuff,” he said.
Dr Magufuli spoke highly of the TRA’s Acting Commissioner for Customs and Excise, Mr Usaje Asubisye, for standing firm against the dishonest importers and directed that he be promoted to full commissioner.
The oil stock in question allegedly belonged to Vegetable Oil Terminal (VOT), Tanzania Liquid Storage (TLS) and East Coast Oils and Fats Limited (EC). The three had claimed that the stock was crude.