There could be many reasons for the reduced assistance but top on the list is the fact that the economies of many donor countries are underperforming due to the devastating global financial crisis. And, for sure Tanzania, in five decades of self-rule, must have learnt, albeit in a hard way, a lesson out of her historical excessive dependence on donor aids.
Cases of stalled development projects due to delayed or unreleased donor funding are common. Finance Ministers have several times decried tendencies by donors to pledge support that they ultimately end up dishonouring, impeding the execution of development projects.
Because these are just pledges they can hardly be enforced notwithstanding the inconveniences they cause to the national budgets. But, with 50 years of independence coupled with abundant resources that the country is endowed with, does it make sense — be it economic, social or political— for it to go begging for about 40 per cent of her national budget, every year?
Research findings have proved that Tanzania collects just peanut of the potential collectable taxes and that the country could otherwise put into proper use the resources it spends, trying to win donors’ sympathy, into widening the tax net for more government revenues.
Few individuals — only those in formal employment— pay income taxes. We are yet to exploit fully the country’s natural resources like mining, forestry, fishery, water and fertile land for the benefit of all the people. Unfortunately, even the few investors who venture investing in the country and create jobs for our people get frustrated, mainly due to bureaucracy and corruption.
As Mr Sebregondi rightly said Tanzania has to review its expenditures and investment priorities. All economies in the world, including donors, are deploying austerity measures to cope with the reigning financial difficulties, and in no way can Tanzania be an exception.
With a bit of increased efforts in tax collection, the Tanzania Revenue Authority (TRA) can averagely collect 1trn/- a month, which translates into 12trn/- a year. Should the government seriously decide to get rid of lavish spending; the country can smoothly run without a single cent from donors.