Policymakers of Tanzania are pressuring the government to speed up the collection of tax to curb the loss of taxpayers’ money dollars each year to corruption and outright theft.
The new electronic system named ‘Power of the Purse’, is planned to assist officials track down revenue receipts, said the policymakers. Officials also want to improve electronic tracking of government spending.
The country loses approximately Tsh.700 billion ($4.37 million) annually a leaky system which allows tax evasion and mismanagement of public finances, encouraging foreign donors to slash budget support aid three years ago.
The move to electronic tax collection and budgeting is part of a broader push internationally to use technology to improve government accountability.
“We have instructed the government to immediately start collecting revenue from central and local government sources using electronic fiscal devices,” said Zitto Kabwe, chairman of a parliamentary oversight committee on public accounts and deputy leader of the opposition in the parliament.
The Tanzania Revenue Authority (TRA) projects it will collect Tsh. 9.5 trillion ($5.8 billion) in the 2013/14 fiscal year (July-June), a 19.9 percent rise from 2012/13 when tax collection rose by 16 percent.
The Electronic Fiscal Device allows businesses to manage and analyze their sales and stock control electronically. The device created by TRA is secure and it calculates total turnover and government taxes due under each revenue category.
The TRA has also launched an electronic system for filing tax returns, and is working with the mobile networks to enable customers to pay their income taxes by phone as Tanzanians can already use their mobile phones to pay certain fees such as those for motor vehicle licenses’.
The TRA also plans to roll out applications for citizens to monitor how government revenues are collected and spent.