TRA: Electronic stamps on soft drinks here from August 1

29Jul 2019
Henry Mwangonde
Dar es Salaam
The Guardian
TRA: Electronic stamps on soft drinks here from August 1

THE Tanzania Revenue Authority (TRA) has announced 1st August as effective date for the implementation of phase two of the Electronic Tax Stamps (ETS) on carbonated and soft drinks manufacturing companies.

TRA says ETS second phase shall also apply to sweetened or flavored water and other non-alcoholic beverages, but with the exclusion of fruit vegetable juice.

In a public notice published in newspapers, TRA said the date is announced in advance in accordance with provisions of regulation 29 of the ETS Regulations 2018, applicable for locally produced and imported products.

“Admittedly, the abovementioned products in phase two were not affixed with tax stamps prior to an introduction of ETS. Henceforth, all products currently present in the market and in the warehouses of either the manufactures or importers will continue to be traded up to 31st January 2020.It follows therefore that after the fixed end date (31st January 2020) all relevant goods shall be affixed with ETS,” reads part of the notice.

 TRA announced earlier this month that it was in the final stages of rolling out the second phase of shifting to electronic tax stamps.

The decision to roll out ETS and ending physical stamps stems from numerous incidents of tax evasion and counterfeiting.

TRA started the first phase of ETS on wines, spirits and cigarettes in January this year, then fully rolled out for all alcoholic drinks, cigarettes and bottled water on June 15.

A Swiss firm, Société Industrielle et Commerciale de Produits Alimentaires (SICPA) won the tender and subsequently signed a contract with TRA for supply, installation and provision of supporting software and hardware for the ETS management system.

Electronic tax stamps are meant to replace hitherto paper-based tax stamps initially attached to cigarettes, wines and spirits. The old system was prone to tax evasion through under-declaration, among other malpractices.

The ETS management system automatically stamps the products at the end of the production line and submits the count in real time through an electronic conduit method to TRA databases.

Available data indicates that since ETS started being implemented during the first phase on tobacco and alcoholic drinks in January, collections for excise duty on locally produced spirits increased by 22.7 per cent.

TRA indicates in the data that excise duty from the spirits increased from 18.5bn/- in January-March 2018 to reach 22.7bn/- in the January-March 2019 period.

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