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Govt losing 5bn/- annually on pharmaceutical imports -report
2006-04-17 09:24:37
By Ludger Kasumuni
The government has been losing over 5bn/- annually due to imposition of zero rate of import duties on all pharmaceutical imports under the Common External Tariffs (CET) set by the East African Customs Union.
According to the report on the 2006/7 budget proposals submitted to the government by the Confederation of Tanzania Industries (CTI), the EAC Common External Tariffs at zero per cent on all pharmaceutical imports is eating up government revenue apart from ruining local pharmaceutical industries.
’’Local industry, which has made large investments in recent years, will become unviable, also leading to loss of employment,’’ says CTI.
The report, which was submitted last week to the government led Task Force of Tax Reforms also, says that consumers have not benefited from such rate of CET, because they had continued to pay higher prices to the advantage of importers.
The CTI proposes that the government has to impose 10 per cent duty on all pharmaceutical imports, other than antiretroviral drugs (ARVs), anti malaria drugs, TB medicines and government procurement of pharmaceuticals.
The justification for these proposals, according to CTI, is to increase government revenue, create more job opportunities and support local pharmaceutical industry.
Among other proposals put forward by CTI, include imposition of zero rate of Value Added Tax on milk and milk products and allocation of budget to support school milk programme and generic milk promotion.
Others are reduction of excise duty for soft drinks (non-alcoholic drinks to allow expansion of soft drinks industry and adjustment of excise duties on beer and cigarettes in accordance with the prevailing rate of inflation.
These proposals were submitted by CTI under the category of non-EAC issues.
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