Charcoal should be levied -call
 
2006-08-06 08:27:14
By Perege Gumbo

	A man selling charcol, arrives at the open market of forest products at Mbagala Kizuiani in Dar es Salaam (Photo: Staff photographer)

Economists have proposed radical measures of levying 2000/-per every bag of charcoal entering cities to protect the environments of the forests bordering urban areas where deforestation for commercial charcoal trade is threatening the forests’ existence.

The environmental tax on each bag of charcoal entering cities, would earn Dar es Salaam city for example more than 30bn/- from the estimated 15 million bags of charcoal entering the city annually.

Dr. Godius Kahyarara, the Research Associate at the Centre for the Study of African Economies in the Economics Department of Oxford University, said such steps and money raised would adequately finance the environmental budget estimated at 10 billion/- in the just approved budget.

He made the proposals while giving comments on the general state of the environment, in particular the rate of deforestation that is being undertaken by villagers bordering forests near big cities.

While commending government steps to reduce excise duty on kerosene and tax relief in the 2006/07 budget on gas as one way of encouraging people to use these commodities, and reduce over dependence on firewood and charcoal, he said fiscal steps are still needed to halt the on going haphazard logging and deforestation for commercial charcoal purposes.

’’Of course, other tough measures need to be instituted in licensing of trade in forest-related products. Sellers of charcoal, timber, firewood especially in towns, are not adequately covered in the tax system but they are an important source of funds for rehabilitating the destructed environment’’ he said.

Surveys have revealed that reasons for persistence over reliance on charcoal by the city dwellers were so diverse and sometimes had no relation with higher prices of gas and kerosene.

The reliance on charcoal by city dwellers contradicts the fact that Dar es Salaam is the most electrified region of Tanzania, with most households being above the poverty line.

This year’s government’s overall objective of its financial budget as well as revenue source base target to operationalize a series of development plans such as MKUKUTA, Vision 2025, and Millennium Development Goals.

’’Since these are the targets, then other parameters that target wage employment growth rate, population growth rate, fiscal gap, and fiscal gap and drag should also be included’’ he said.

’’The difference between the internal and external source of revenue should be set to decline over time as we move to the set timelines of our development to avoid decline in domestic spending when we will be forced to pay back,’’ he said.

Economists haved hailed the government for its commitment as shown in the 2006/07 approved budget since it aims at addressing issues that touch on people’s problems.

This financial year’s budget touches on issues that include protection of local industries by increasing duty rates on imports; encourage use of solar power and energy saving bulbs, and reduction of impact of increased fuel prices.

Other components were to encourage investment through collective Investment schemes, and attracting companies to list on the Das es Salaam Stock Exchanges (DSE).

During this financial year, the government will spend a total of 4.2 trillion shillings for recurrent and development expenditure, and it is expected that revenue collection would go up by 2 per cent, thereby reducing dependence no foreign budget financing by the same percentage.

• SOURCE: Sunday Observer