Two out of every 10 Tanzanians simply refused to pay tax between 2011 and 2013, it has emerged. According to a new Afrobarometer study, the number of self-reported levels of non-compliance are far higher in Tanzania than in the other 29 sub-Saharan countries surveyed.
The report titled “Africa’s Willing Taxpayers Thwarted by Opaque Tax Systems, Corruption” was released on Tuesday. Survey data reveals widespread citizen commitment to the principle of taxation and to paying up for national development. But their enthusiasm is dimmed by taxation systems across the continent that remain opaque to the majority. Perceived corruption among tax authorities remains significant and evidence suggests these perceptions undermine public commitment to the integrity of the tax system and increase the likelihood of non-compliance, according to the report.
In Tanzania, the integrity level of tax authorities remains a matter of concern for the public. Thirty eight per cent of respondents said most, if not all, of the authorities are corrupt. Forty eight per cent said some are corrupt and only eight per cent gave the tax authorities a clean bill of health.
The vast majority of Tanzanians–at 86 per cent–also said that, based on their experience, it is difficult to establish how the government uses the revenue generated from taxes and fees.
The report comes amid the Tanzania Revenue Authority’s attempt to widen the range of tax collection. Only those employed in the formal sector have consistently paid tax because their income can be easily traced and they have no way of avoiding or evading paying up.
Tax collection has improved from Sh4,049.1 billion in 2008/2009 to Sh7, 739.3 billion in 2012/2013–an improvement of 91 per cent, which counts for an improvement of 20 per cent every year. But, according to the co-author of the Afrobarometer report and Director of Governance and Service Delivery at Research for Poverty Alleviation (REPOA), Ms Rose Aiko, TRA has a mountain to climb to reach its targets. “The general picture out there is that tax collection hasn’t improved that much,” she said. “Some people are evading but some don’t even know if they owe, what they owe and when they owe the government tax or fees.”
According to Ms Aiko, TRA has to work hard to improve its image if it is to perform its duties effectively. She added: “Some challenges are capacity-based, but this bad image needs to be addressed quickly. People are still looking at it as corrupt and, most likely, the compliance will improve when that is sorted out.”
Speaking on Taxpayers’ Day last November, TRA Commissioner-General Harry Kitilya admitted that in order to achieve tax collection targets in the country, it was important for employees to adhere to the code of conduct to curb corruption complaints from taxpayers.
“TRA will improve its code of conduct among its employees to ensure they work hard, efficiently and professionally for better reputation of the authority,” said Mr Kitilya, adding that TRA–in collaboration with British revenue and customs officials–was in the process of establishing a special desk that would deal with tax complaints from customers.
The Afrobarometer study was conducted between 2011 and 2013 and used a sample size of 53,000 respondents Africawide. In Tanzania, it sampled 2,400 respondents.