ETS raise exercise duty collections by 60-percent

04Oct 2021
The Guardian Reporter
The Guardian
ETS raise exercise duty collections by 60-percent

EXERCISE duty collections by the Tanzania Revenue Authority (TRA) increased by 60-percent in the last two and half years following the adoption of Electronic Tax Stamps (ETS).

Latest data shows TRA collected 297.2bn/- as excise duty on beer, wine and spirits (both locally-produced and imported ones) during the three years before January 15, 2019, the amount rose to 476.7bn/- by June this year.

“This is a 60-percent increase if the three years prior to the rollout of ETS’ on beer, wines and spirits was compared to an almost similar period after the rollout,” said ETS project manager at TRA, Innocent Minja.

Minja said Excise duty and VAT on bottled of water has gone up by almost 156 percent. Excise duty and VAT on beer has gone up by 15- percent while that of soft drinks has risen by 29- percent.

The government introduced plans to adopt the ETS system in June 2018 and the first phase of the project was conducted on January 15, 2019 whereby stamps were installed on companies that produce beer, wine and spirits.

Phase two of the project was rolled out on August 1, 2019 when ETS’ were stamped on sweetened flavored water and other non-alcoholic beverages, like energy and malt drinks and soda.

He however said there could always be room for further improvement in the management of the project, adding that so far, the benefits extend even to manufacturers.

One of the key issues that Minja said, there was need for review of the ETs rates which he said he believed would be beneficial to both sides.

The third phase of ETS, which involved enrolling electronic stamps on fruit juices (including grape must), vegetable juices (under Heading 20.09), and bottled drinking water, was conducted November 1, 2020.

He said there had been double-digits excise duty growth rates from all the products on which ETS’ have been stamped.

Before the adoption of ETS’, excise duty on locally produced and imported products were being determined through paper stamps which, TRA says, were easy to tamper with.

The ETS enables the government to use modern technology to obtain production data timely from manufacturers. That way, it does not only enable the government to collect the right amount of excise duty but it also discourages the entry of counterfeits into the market.