DAR LOSES BILLIONS IN NEGLECTED TAXES

Controller and Auditor General, Prof Mussa Assad.

The Controller and Auditor General (CAG), Prof Mussa Assad, on Tuesday unveiled several shortcomings which deny the government revenue, including unresolved tax appeals on cases worth over 1.7tr/-, that are pending before the Tax Appeals Board and Tribunal.

In his summary of audit reports for the financial year ending June 2014, he presented before the National Assembly on Tuesday, Prof Assad disclosed the existence of such cases initiated by the Tanzania Revenue Authority (TRA).

He told a press conference that the said cases were before the Tax Revenue Appeals Tribunal and Tax Revenue Appeals Board, which have not been determined as of today.

Prof Assad pointed out that 261.19bn/- worth of the cases have stuck at the Tax Revenue Appeals Tribunal for a long time, while the remaining amount of 1,455.04bn/- were awaiting the decisions of the Tax Revenue Appeals Board.

The CAG, therefore, proposed for fast disposal of the cases in question and that the TRA management should double its efforts to improve the inspection and investigation process to reduce complaints between the authority and tax payers.

On tax exemptions, Prof Assad noted weaknesses on the misuse of tax exemptions grated on mines. He said that some fuel expected to be used by various companies were exempted tax worth 22.33bn/-.

He said that such companies, Geita Gold Mine and Resolute Tanzania Limited sent fuel to contractors who did not deserve exemption, causing the said amount not to be collected.

According to him, there was also use of tax exemption for different purposes as was previously expected and triggered a loss of 392.7m/- caused by Kiliwarrior Expeditions Limited of Arusha.

Such company, the CAG said, had been granted a tax of 465.2m/- to import 28 motor vehicles. Out of the amount, he said, TRA managed to realise 72.5m/- only.

Prof Assad further disclosed that a tax exemption of 53.4m/- was also granted to Kilemakyaro Mountain Lodge Limited for construction and expansion of a hotel at Changarawe Village in Karatu District.

The company, the CAG said, imported three motor vehicles through tax exemption. However, he said, the audit revealed that the purchase of only one vehicle - a Hyundai Santa - but the whereabouts of two other motor vehicles, a BMW X5 and a Toyota Land Cruiser Prado could not be known.

Regarding own sources of revenue, Prof Assad discovered in his audit that in the central government, institutions under revenue retention scheme withheld a sum of 32.74b/-, thus affecting implementation of duties planned by the said institutions.

On local government authorities, a total of 1.2bn/- could not be returned in a sample of 32 councils from the Ministry of Land, Housing and Human Settlement Developments, which is 30 per cent of revenue collected as tax involving land use, which was to be returned to the council concerned.

He pointed out also that 56 Local government authorities had uncollected revenue totalling 4.9bn/-from revenue collectors. He, therefore, recommended that the government should return funds to the institutions timely as per revenue retention scheme agreements.

Prof Assad also said that the audit discovered non-use of electronic machines using EFD receipts on 4.4bn/- payments from different private businessmen and 4.6bn/- on samples from 22 local government authorities.

He pointed out that TRA imposed a total fine of 440.8m/- on various businessmen who failed to use EFD electronic machines, but only 72m/-, which is equivalent to 16 per cent has been realised, leaving a balance of 369m/-.

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