The son of man as he called himself asked them to see the money that was in use at the time. When he asked whose inscription appeared on the coin they happily responded it was Caesar’s. He told them to give unto Caesar what belongs to Caesar and to God what is for God. He was telling them to fulfil their tax obligations to the authority which issued the legal tender.
The lesson for Tanzanians and other nationalities is if your picture is not on the coins and notes of the United Republic, you must pay income and sales taxes to government. Some traders cheat on VAT by issuing no receipts. A food and drinks joint might sell five million/- daily Thursday to Sunday. From Monday to Wednesday sales go down to just 500,000/-.
Do not be alarmed if such traders declare 300,000/- sales per day on their VAT returns. That is what they base their income tax calculations on. That is pure theft. There are perhaps two million small businesses such as tailoring, retail kiosks for various goods, catering, music hire, amateur video production for weddings and other functions in our cities earning millions of shillings every month. Do they pay unto Caesar? On any given weekend, one can easily count 20 weddings in Dar alone.
Mwanza, Arusha, Mbeya, Tanga and a few other towns and the numbers are running into hundreds of weddings per week in towns and cities. There is a whole industry around doing services for weddings. Almost everybody buys something for the bride and groom or for themselves.
Hundreds of millions of shillings are spent. The question is does every service provider, dukawallas and limousine hire franchise pay VAT? Kwa nini? Or are there businesses owned by public officials or their relatives and therefore normal rules do not apply? No wedding worth its name costs less than 25 million. Not too long ago, government or somebody identified and congratulated the top 15 taxpayers in the country.
In the past Tanzania used to depend on beer and cigarettes to finance its budget. They call these taxes for sins. This is because we did not know how to collect taxes so we look for easy victims like public sector employees to tax. Government may not be collecting taxes from many who should pay. Like mechanics, masons, carpenters and welders who earn millions of shillings selling their artisan skills. How many are registered as taxpayers?
When President Obama paraphrased the bible by saying more will be expected of those who have, he was making a strong case for taxing the rich more. In Tanzania we exempt parliamentarians, ministers, directors and other high level civil servants from paying taxes on allowances.
Those who vehemently opposed minister Mkullo’s proposal to tax allowances were probably being short sighted. The wealthy should give back more in taxes. Have we created an enabling environment for those registered to pay taxes without unnecessary encumbrance? Like having to stand in queue for two hours to get a tax assessment then another two hours to reach a cashier in a bank away from revenue offices and having to go back to TRA to get official receipt? The top 15 taxpayers naturally include companies that sell beer so much it can flood Msimbazi creek.
How come companies that sell lakes of sodas and drinking water are missing from the top 15? In this land of Zanzibar and Ngorongoro Crater there are many who drink beer. However, everybody drinks water. These days, bottled water is popular from Ukerewe and UK to Kirua Vunjo, also called KV. How much VAT is paid by Tanesco, Vodacom, Tigo, Airtel and similar companies? I pick on Tanesco because it transmits millions of KV every day.
Tanesco generates say 500 megawatts of power per day and sells it for 200-500/- per kilowatt. It means Tanesco gets trillions of shillings per year of which 18% is paid by electricity consumers as tax to government. Why do I go on and on about VAT? VAT does not belong to the shopkeeper or factory owner.
VAT is paid by buyers, therefore a trader not paying VAT resembles a worshipper who was asked to count the money contributed as zakat by faithful on Friday or Sunday service at a mosque or church, and keeps the money for himself instead of handing it over to the church or masjid. Traders and consumers have a duty to pay own taxes from their operating profits.
There is a huge difference between tax on income and licensing fees. Too many traders in markets and shops believe they pay taxes because the city authorities charge them some kind of fee for operating within the city. There are many small traders in markets whose individual daily sales can run into hundreds of thousands of shillings. Their monthly profits are much higher than salaries of modern graduates. Are they fulfilling their tax obligations?
Do they find ways of avoiding taxes in collusion with unscrupulous tax collectors who like the proverbial biblical tax collector advises traders to record 50 instead of 100 sacks of maize sold? Government must devise mechanisms of educating the public on the why and how to fulfil their tax obligations. But more importantly the finance ministry must devise easier ways for people to pay taxes, for example through mobile phone banking that is now proving very popular in many countries, Tanzania included.
There is no reason why we can pay electricity, satellite TV and fuel bills by phone in the comfort of our homes but we are obliged to spend the whole day trying to pay licensing fees and taxes in long queues in front of staff with bad attitudes. Citizens cannot demand better services without everybody paying due taxes.
email@example.com; cell 0755-246-136