Minister explains airtime charges, Budget is passed

23Jun 2021
Francis Kajubi
The Guardian
Minister explains airtime charges, Budget is passed

​​​​​​​THE National Assembly yesterday approved the Appropriation Bill authorizing expenditure of 36.681trn/- in the 2021/22 financial year.

Members of Parliament congratulate Finance and Planning minister Dr Mwigulu Nchemba (in his trademark yellow-green-black-&-blue tie) in the National Assembly in Dodoma city yesterday shortly after the House approved the estimates of the Government Budget for financial year 2021/2022. He tabled the draft budget on Thursday. Photo: Correspondent Ibrahim Joseph

Finance and Planning minister Dr Mwigulu Nchemba explained new charges introduced on airtime and mobile money transactions at length, as the most pertinent issue raised in parliamentary discussions on the Budget estimates.

Winding up debate on the estimates which brought 209 parliamentary contributions, the minister said that the charges were affordable as they are paid according to subscribers’ credit recharging capacity.

In his clarification, the minister said that the charges are not meant to be charged daily but only when a subscriber recharges airtime with fresh credit, with charges categorized in groups depending on subscribers' credit recharging ability.

“Not less than eight million subscribers consume between 1,000/- and 6,500/- a day on credit for airtime and data. This group will be charged a levy of 5/- to 10/- on every fresh credit recharged. One who recharges between 7,500/- and 10,000/- will be levied 76/-, he said.

Recharging from 10,000/- to 25,000/- shall invite 112/- charge while recharging at 25,000/- and up to 100,000/- are liable to 186/- of which the airtime is most likely to last for a month. Those who spend over 100,000/- is levied 200/- in the scheme, he elaborated.

The mobile phone data and airtime levy seeks to rake up sufficient funds where revenue collection to the tune of 396.306bn/- during the fiscal 2021/22 would be directed at rural roads construction, via the agency TARURA.

The minister asserted that the tax base of the country is still narrow so the government is coming up with initiatives that target direct contributions for needs of development funds, to avoid reliance on concessional and commercial foreign loans.

Leaving out indirect taxes, registered large taxpayers are only 504 while the 3.162m are registered as taxpayers out of an estimated population of 60m, he stated.

“How are we going to source the estimated 24trn/- to service the strategic mega projects and others if not by every Tanzanian contributing to development funds through paying tax?” he demanded.

Over 400bn/- has been approved for the rural roads agency, where an additional sum of 322bn/- from the airtime and data recharging levy has been placed on top of it just to make sure that rural roads are in good condition to enable economic activities, he stated.

Every parliamentarian will benefit with an addition of one billion shillings from the added amount to be dedicated to road projects in each constituency, he declared.

Another 50bn/- has been placed on top of the approved health budget to boost procurement of health and treatment facilities. Another 207bn/- will be added to Ministry of Water estimates, he stated.

Another 70bn/- has been added on top of the 500bn/- approved for the Higher Education Students’ Loans Board (HESLB),with the money likely to accommodate 10,000 higher learning students, as 11,000 students didn’t get loans in the 2020/2021 fiscal year, he explained.

The sum of 100bn/- has been added to the 1.1trn/- Health ministry budget to finance the construction of health facilities across the country. On the other hand, an additional 125bn/- was inked for Education ministry for construction of ten classroom units in every district, he affirmed.

On the levy on mobile money transaction, the minister said that in sending the money one will pay 10/- in any transaction valued at 1,000/- to 2,000/-, and  be charged 300/- for transactions starting from 10,000/- to 15,000/-. Sending 30,000/-or above on mobile means invites an extra charge or 1,000/- while sending 5m/- and above fetches a 10,000/- levy.

The charges were made under the amended Electronic and Postal Communications Act, CAP 306 in the Finance Bill for 2021/2022 for mobile money transaction of sending and withdrawing cash where the government intends to collect the hefty sum of 1.254trn/-.

If the money is sourced to capacity, it will be allocated to financing projects for the Tanzania Rural and Urban Roads Agency (TARURA), construction of the Standard Gauge Railway (SGR) and the Rural Water Supply and Sanitation Agency (RUWASA), he stated.

About 63 percent of the budget is meant for recurrent expenditure and 37 per cent for development projects, which is put at 13.26trn/-. Of this amount, about 10.40trn/- or about 78.2 percent of total development expenditure will be sourced from internal revenue and 2.9trn/- tapped from external sources, he added.

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