‘Govt must endear to donors, devise new revenue sources’

17Jun 2021
By Guardian Reporter
Dar es Salaam
The Guardian
‘Govt must endear to donors, devise new revenue sources’

MOBILISATION of funds for development projects in the 36trn/- budget projection for the 2021/22 financial year will be achieved if the government endears itself to development partners and devices new sources of internal revenue, a retired administrator has declared.

Ludovick Utouh, a former Controller and Auditor General (CAG) and executive director of the Wajibu Institute of Public Accountability (WIPA) made this observation when presenting an analysis of the 2021/22 budget estimates in Dar es Salaam yesterday.

Urging that the government should also work to reduce the national debt, the former CAG who was accompanied by Mzumbe University Business School principal, Prof Honest Ngowi said that overall, the government had done well.

He praised it for coming up with what he termed as the poor man’s budget, asserting that more revenue sources would enable the government accomplish ongoing flagship projects and start new ones.

Despite the fact that the national debt remains within sustainable levels, there is a need for the government to look for new revenue sources so as to swiftly service the national debt which has reached 29 per cent of the 2021/22 budget expenditure commitments, he stated.

He commended the government for improving relations with development partners as this will facilitate obtaining more funds to support the budget, along with concessional loans that have more generous terms than market-based loans.

On the collection of property tax be conducted on a prepaid format as with electricity, Utouh said that in order to avoid discretional decisions on who is supposed to pay what amount, the government needs to set uniform payment scaled to expenses.

It also needs to reinforce the security of ICT systems, to ensure that database servers are manned and owned by public institutions, similarly underlining the need to amend the Public-Private Partnership (PPP) Act of 2010 to help achieve objectives of the proposed budget.

“As it is now, the one who finances the feasibility study gets into the competition, something that might jeopardize the execution of the project if the one who financed the study fails to secure the tender,” he argued.

Reports on the performance of public institutions like the Prevention and Combating of Corruption Bureau (PCCB), the Office of the Treasury Registrar and the Ethics Secretariat should be made public and presented to the National Assembly, while also being opened to the public, he emphasised.

The Wajibu assessment also suggested that the Tanzania Revenue Authority (TRA), the Bank of Tanzania and the Tanzania Communications Regulatory Authority (TCRA) invest heavily in building capacity on identifying and tax online business, which he said is booming in the country.

CAG reports known as ‘management letters for public entities’ should also be public, and the legislature make effective management of implementation of the approved budget, so that it achieves intended objectives, he said.

This can be done by ensuring it reviews quarterly budget implementation reports that are provided by the Treasury, he affirmed, while advising the government to initiate discussions with neighboring countries on extending services to those countries when strategic projects like the Julius Nyerere Hydro Power Project (JNHPP) and the Standard Gauge Railway (SGR) are completed.

Such a link would improve foreign currency flows so as to cover huge debts arising from the projects, he elaborated
"The government should ensure that it increases financial capacity, staffing and infrastructure of tax arbitration tribunals so as to hear and decide tax cases as currently 360.08bn/- and $181.43m cases need to be arbitrated,” he said.

The government also needs to reduce the number of projects planned for the year to give it a chance to allocate more funds in implementing a few projects that will be completed on time, the retired administrator intoned.

"Generally, we commend the government for the 2021/22 budget estimates as well as coming up with new sources of revenue such as telephone line tax, municipal bonds as well as property tax through prepaid metering,” he added on the budget where the government proposes to spend 36.329trn/- where 63 percent targets recurrent expenditure and 37 percent caters for development projects.

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