TANZANIA REVENUE AUTHORITY AND SELECTIVE TAXATION

The Tanzania Revenue Authority (TRA) Kilimanjaro regional office is at it again broadcasting to the general street public about how important it is for the prosperity of the nation that everybody pays their taxes on time, this time however they have an additional warning, “do not sell or buy anything at any business premises without a relevant receipt accompanying the transaction”, it this statement which raises eyebrows.TRA your keen desire to advertise your mission via whatever media form is acknowledged, however this frequent advertising campaign does not in itself constitute a strategic campaign for making businesses issue receipt in effect of their sells. We can give you a sample of businesses that sell 90% of their merchandise without issuing receipts, and not goods of negligible value for that matter.

A tailoring shop displaying suits made at the back room near Moshi.

This lady is not allowed to let intruders in the backroom workshop in order to fool TRA about the size of their business.

Tailoring shops are known to sell clothing materials and sew suits worth up to 300,000/- Tshs per piece without issuing any receipt, a suit being a personal purchase an individual feels no obligation to ‘report’ this purchase to any authority, as claiming a receipt tends to reflect, it is while buying goods on behalf of an employer that one feels hard pressed to claim for a receipt mostly for auditing and book keeping purposes. Fueling stations are also notorious for selling most of their commodities in paperless fashion and getting away with it left and right, you can confirm this any minute by pulling up at one and doing a fuel purchase, no one bothers until you ask for a receipt and not many drivers are interested in wasting time for the piece of paper which contributes nothing to their motoring experience, as long as the tank has been filled up.Even less so are motorcycle taxi riders (bodaboda) most of whom are too busy chasing potential passengers to ask for receipts,this has led to owners of fueling stations to earmark separate dispensing pumps for these 'very good customers' as the whole day business at such pumps is 'clean'or paperless.There is always a loophole for becoming a millionaire in selling fuel!
We also have timber yards, some of them receiving cargoes worth millions every week and retailing it accordingly but with very scarce issuance of any documentation to the effect.  

On the other hand however, public servants and other employees with registered companies and organizations have their tax deductions automatically done by their employers for the TRA, a practice which does immense injustice to the employees registered for Pay As You Earn (PAYE) and possibly which also lends this kind of laxity to the TRA authorities such that they do not strive sufficiently to make all earners pay their taxes accordingly simply because the taxman has a cash cow securely tied up somewhere for milking each end of month, willingly or not!.

I am no tax expert but the first logical approach I would employ to nab a company with such tax evading methods would be to do a paper trail investigation on merchandise volumes and values. This would involve requesting their wholesale purchases documents and tally them with copies of their retails while taking actual measurements of items in their inventories, the differences would ignite fire.
The story of tax exemptions for institutions owned by religious organisations especially educational institutions while incurring operating expenses comparable penny by penny with any other equivalent institutions owned by private individuals or companies and charging fees at the same rate needs a deeper analysis and maybe a contribution of views from different parties.
It therefore is a matter of concern to all who pay their taxes dutifully,albeit against their better commonsense, that if the taxman strives and succeeds in spreading the tax net wide enough the burden would be reduced to others and tax won't be such a terrible word after all.
see also:www.actionaid.org/sites/.../eac_report.pdf