Posts tagged as: taxes

Gatete Rallies on Tax Compliance

By Frederic Byumvuhore

Taxes are an integral part of the development of a nation, Finance and Economic Planning Claver Gatete has said.

The minister made the remarks on Wednesday, while officiating at the ‘2017 Taxpayers’ Appreciation Day in Rubavu District.

The day was celebrated under the theme, “My tax, my development, my destiny.”

In the fiscal year 2016/17, Rwanda Revenue Authority collected Rwf1,103 billion in tax revenue, surpassing its target by Rwf8.7 billion.

Gatete said that the image that the nation has today regionally and globally comes as a result of homegrown solutions and hard work, adding that taxes are the engine of infrastructure development.

“The country has achieved a lot. Infrastructure has been developed and more other projects are ongoing. All these are from everyone’s efforts to support government policy of encouraging business owners to pay taxes. We have to strive for sustainability. The seven years ahead require us to work harder,” he said.

Tax compliance will make us self-reliant, he added.

The minister called on development partners to work together to support the ongoing infrastructure projects, saying these will drive the Government’s vision to ensure good road networks that ease trade in the country and beyond.

RRA commissioner-general Richard Tusabe explained that the taxpayers’ day recognises exemplary tax payers and inspires others to do the same.

He said this year’s theme reminded everyone of their role in tax collection.

He attributed the success in tax collection to new measures implemented by the government, and training for taxpayers, as well as collaboration between the tax body and private sector, security organs and local government.

Jean Claude Gahunga, Amaco Paints chief executive, whose company won the best taxpayer in Western Province, said that paying taxes benefits businesses.

“Taxes benefit all Rwandans. It is everyone’s duty to pay taxes,” Gahunga said.

Rwanda

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Tanzania: Dar Airport Works On Course

By Abela Msikula

TERMINAL Three operations at Julius Nyerere International Airport (JNIA) are set to take off in October, next year, the Minister for Works, Transport and Communications, Prof Makame Mbarawa, said yesterday during a tour at the Airport.

He observed that construction activities were complete by 64 per cent. All civil works are almost done and soon the contractor will shift to another stage. He revealed that there was no government debt to the contractor as all payments have been made.

He added that: “It is because we want everything to be complete as we have planned. We want to see full operations in October, next year.” He insisted that the terminal is set to accommodate over 20 airbuses at once, with 22 inside the air-bridge and others outside.

However, the presence of many airbuses will depend on demand. More than eight million passengers are expected on annual basis, according to the minister — almost four times of the current amount. Apart from taxes and foreign currencies to the country, Prof Mbarawa added, Tanzanians will also benefit from direct and indirect jobs.

He admitted that the current passengers’ wing (Terminal Two) has a lot of challenges, and that is why the government has been speeding up Terminal Three construction.

Questioned on how much the government has already spent on the job (64 percent), the minister said that: ” I currently have no specific figures since we have been paying in installments. But the public should know that the project will cost not less than 560bn/-.”

Following the good progress of construction activities, the government looked forward to issuing tenders to cargo companies in a bid to meet passenger requirements. Currently, according to him, there are only two companies, namely Swiss-Port and Nas Dar Airco.

Following the expected passenger increase, many more companies are needed.

Tanzania

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Angola: Cuanza Sul – Port Services Firm Brings New Prospect to Region

Porto — The inauguration of the offices of the Porto Amboim Port services firm and the building of the National Freight Services Council, in the centre-west Cuanza Sul Province, open new prospect in the collection of revenues for this region, the Transports minister, Augusto da Silva Tomás, has said.

Speaking in the inauguration ceremony of the referred infrastructures, in Porto Amboim City, the minister said that the two institutions will contribute to a better collection of revenues, as well as to the region’s economic development, through the payment of taxes.

He also announced the project of building a new deep-waters port in Porto Amboim which is intended to boost the province’s economy.

According to Augusto Tomás, the port that the Executive intends to build in Porto Amboim City will being about many benefits, such as the increase of jobs and the improvement of the citizens’ living standard.

To the governor of Cuanza Sul Province, Eusébio de Brito Teixeira, conditions are set for port services companies to carry out their activities without constraints, having reminded that the new undertakings will provide jobs to many youths.

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Angola: Cuanza Sul – Port Services Firm Brings New Perspectives to Region

Porto — The inauguration of the offices of the Porto Amboim Port services firm and the building of the National Freight Services Council, in the centre-west Cuanza Sul Province, open new perspectives in the collection of revenues for this region, the Transports minister, Augusto da Silva Tomás, has said.

Speaking in the inauguration ceremony of the referred infrastructures, in Porto Amboim City, the minister said that the two institutions will contribute to a better collection of revenues, as well as to the region’s economic development, through the payment of taxes.

He also announced the project of building a new deep-waters port in Porto Amboim which is intended to boost the province’s economy.

According to Augusto Tomás, the port that the Executive intends to build in Porto Amboim City will being about many benefits, such as the increase of jobs and the improvement of the citizens’ living standard.

To the governor of Cuanza Sul Province, Eusébio de Brito Teixeira, conditions are set for port services companies to carry out their activities without constraints, having reminded that the new undertakings will provide jobs to many youths.

Angola

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Nyong’o Set to Unseat Ranguma As Kisumu Governor

By Dannish Odongo

Nairobi — Kisumu County’s Orange Democratic Movement (ODM) gubernatorial candidate Anyan’g Nyong’o has sprinted to a decisive win past his arch rival, Independent candidate Jack Ranguma, who is the incumbent.

According to provisional results being relayed by the Independent Electoral and Boundaries Commission (IEBC), Nyong’o is commanding a decisive lead with 259 493 votes translating to 63.38 percent of the votes cast trailed by Ranguma with 145 790 votes translating to 35.61 percent of the votes cast as at 13:10pm on August 9.

Ranguma won in 2013 on an ODM ticket but during party primaries, he was floored by the professor of political science. He unsuccessfully contested the results and resorted to vying as an independent candidate. Of the seven constituencies, Ranguma only commands a lead in Nyando constituency where he comes from. Nyong’o leads in Nyakach, Muhoroni, Seme, Kisumu East, Kisumu West, and Kisumu central.

Jubilee Party’s Christine Atieno Otieno trails the two leading at a distant third position with 1,983 votes translating to 0.48 per cent of the votes cast.

Amani National Congress’s (ANC) Peter Charles Owino comes fourth with 1,539 votes representing 0.38 per cent of the votes.

Nyong’o was born on October 10, 1945 and is the outgoing Senator for Kisumu County

He started his political career in 1993 having been elected the Member of Parliament for Kisumu Rural.

He graduated from the University of Chicago (USA) in 1977 with a PhD in Political Science.

Ranguma in 2002 was appointed Commissioner of Income Tax, and later Commissioner of Domestic Taxes, Kenya Revenue Authority (KRA) but was replaced when the rainbow coalition came to power.

His first stint in politics was successful when he vied for and won Kisumu’s gubernatorial seat.

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Kenya: Experts Fault Taxman’s Plan to Deactivate Non-Compliant Pins

By Mugambi Mutegi

Legal experts have faulted the taxman’s announcement that he will deactivate the Personal Identification Numbers (PINs) of non-compliant taxpayers, terming it illegal.

Lawyers said holding a tax PIN is the right of every citizen that cannot be taken away by fiat without following due process.

“KRA does not issue PINs to citizens as a favour but as provided for in law, in the same way the Department of Registration of Persons issues Identity Cards or Passports,” said Nairobi lawyer Nashon Aluoka.

“It is an instrument that every adult needs to transact the business of life and meet their obligations as citizens and can only be taken away as provided for in law or through a court order,” he said.

The KRA, Mr Aluoka said, has not made clear which law it will be relying on to take such punitive action that is likely to disrupt the lives of millions of Kenyans who may not even be owing any taxes.

The agency has said it will on September 1 deactivate all PINs whose bearers have not migrated to the iTax platform or failed to file taxes as required by law – opening a legal lacunae that may force employers to withhold the salaries of affected employees.

The KRA said last Friday that it had informed employers that they will be committing an illegality if they pay salaries to employees whose PINs have been deactivated. But Mr Aluoka said the taxman would face swift legal action if it acted with such impunity.

“Millions of Kenyans, whose PINs are going to be deactivated do not even qualify to pay taxes and only file tax returns as a matter of procedure but require the PIN to access services and conduct business with fellow citizens or with the government,” Mr Aluoka said, adding that the law could not let the KRA act with discretion over such a serious matter.

Employers act as the KRA’s agents for purposes of collecting income tax. Upon paying staffers, employers are required to remit the taxes by the 9th of the subsequent month.

These are the payments that employees find on the P9 forms (issued by their employer) and which they use to file annual returns between January 1 and June 30 of every year.

Deactivating the PIN would therefore prevent an employer from meeting the monthly filing obligation.

“iTax cannot accept an employer’s PAYE return where the payroll contains employees without PINs or has invalid PINs. It is the responsibility of both the employer and the employee to ensure that the employee has a PIN,” the KRA said in response to queries on the impending action.

Thousands of employees skip filing annual returns while others are yet to migrate to the iTax platform four years after its launch, making them targets of the impending action.

Another set of taxpayers have regularly updated their profiles on the KRA portal but, for nefarious (tax evasion) or purely lethargic reasons, do not file returns when they fall due. iTax, which was made the mandatory tax payment platform in August 2015, enables taxpayers to file returns from any location with Internet connection.

Fresh data from the KRA shows that there are 10.6 million registered taxpayers but only 5.8 million are registered on iTax. In the 2016 filing period, which closed on June 30, only 2.4 million taxpayers filed their returns.

“Upon fulfilment of compliance requirements the same PIN will be reactivated. Taxpayers (will) maintain their PINs initially allocated as the supporting documents used for registration do not change,” the taxman said.

“There is no penalty for PIN reactivation,” KRA said, adding any penalties accrued by non-compliant taxpayers will have to be settled before their accounts are restored.

The KRA, which is under pressure to meet the ever rising revenue targets, is now seeking to prevent non-compliant taxpayers from undertaking transactions that require PINs in a bid to force compliance.

Transactions that need active PIN certificates include registration of titles, approval of development plans, registration, transfer and licensing of motor vehicles, registration of business names and companies.

Others are underwriting of insurance policies, customs clearing and forwarding, payment of deposits for power connections, supplying goods and services to the State, as well as opening accounts with financial institutions.

Tanzania: Acacia Shares Fall to 3yr Low As Row With Tanzania Grows

Photo: The Citizen

(file photo)

Dar es Salaam — Acacia Mining shares plunged to a more than three-year low yesterday after the Tanzania government demanded the company to pay almost $190 billion (Sh424 trillion) worth of unpaid taxes and fines.

The London Securities Exchange (LSE)-listed equities tumbled as much as 17 per cent yesterday morning after it said it had received a series of notices from the Tanzania Revenue Authority relating to the alleged missed tax payments.

The problems of Acacia’s mines in Tanzania started since March when President John Magufuli banned the export of unprocessed mineral concentrates in an effort to boost the country’s domestic smelting industry. The government has since accused Acacia, one of Africa’s largest gold producers and one of Tanzania’s largest private employers, of illegally under-reporting the amount of metal in its shipments and evading billions of dollars of taxes. Acacia warned last week that it will be forced to mothball its flagship mine if it can’t reach an agreement with the government by the end of September, having burned through almost half its cash pile in the past six months.

Shares in the company had already fallen more than 60 per cent since the start of the dispute.

On the Dar es Salaam Stock Exchange, the counter remained flat at Sh7,500 per share.

“It’s not easy to see immediate changes as the counter is not active since it cross-listed. I think no local investor has ever bought the shares through DSE,” said Orbit Securities general manager Juventus Simon.

The revenue authority’s assessments said Acacia owes the government a total of approximately $40 billion in unpaid taxes plus a further $150 billion in penalties and interest. Acacia has consistently denied any wrongdoing, and said it disputes the tax assessments. It added that it “is considering all of its options and rights and will provide a further update in due course”.

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Govt to Sell Exiled Tycoon’s Property

The Rwandan Revenue Authority has placed Kigali’s Union Trade Centre — a $20 million mall owned by exiled tycoon Tribert Rujugiro Ayabatwa — among properties to be auctioned for defaulting on their taxes.

Mr Rujugiro has taken the Rwandan government to the East African Court of Justice for the alleged illegal seizure of his properties.

RRA has published a list of properties up for auction and among them is the mall, which in 2013 was put under the Nyarugenge District Commission of Abandoned Properties.

The government said the property and many others had been put under the management of the Commission of Abandoned Properties for “efficient management,” which among other things includes paying taxes and utility bills.

UTC was put on a list of 14 properties that RRA said “are immovable assets of taxpayers whose properties have been attached and will be auctioned.”

The taxes owed are from 2015, when the building was already in the hands of the Commission of Abandoned Properties.

By press time, The EastAfrican had failed to ascertain how much UTC owes the government.

The EACJ is yet to decide the ongoing case in Arusha in which Mr Rujugiro, who fell out with the government in 2010, seeks to redeem a number of his properties that have been seized.

The case filed in 2013 was dismissed by the First Instance Chamber of the EACJ, but later the Appeal Court ordered the Trial Court to hear it afresh “citing that parties had not been afforded an opportunity to present relevant evidence in support of their respective cases.”

The case is still pending before the trial court and no hearing date has so far been announced.

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Ministers Clash Over Taxes On Soda, Sweets

Photo: The Citizen

Soft-drink.

By Olive Eyotaru

Two ministers in the ministry of Health on Wednesday evening ganged up against the minister of state for Planning, David Bahati, to defeat a proposal to scrap and reduce taxes on sugar confectioneries and non-alcoholic drinks.

The minister of Health, Jane Ruth Aceng, and her deputy, Sarah Opendi, put up a spirited fight before parliament’s Finance committee in a bid to keep the 20 per cent excise duty on chewing gum, sweets and confectionaries.

This was after the ministry of finance proposed in the Excise Duty Amendment Bill 2017 to scrap the levy. The bill, tabled by Bahati, also proposed that a 13 per cent (or Shs 240) charge per litre is imposed on sodas under non-alcoholic beverages, apart from fruit or vegetable juices.

Pegging her explanation on the growing burden of non-communicable diseases (NCDs) such as diabetes, cancer and heart disease among Ugandans, Aceng urged the legislators to support keeping taxes on sugar confectioneries as part of a government effort to curb these diseases.

The minister said reducing taxes will encourage more consumption.

“Uganda needs to go back to the olden days when these things were luxuries. Those sweets and chocolates are what are causing us huge bills for dentistry,” she said, adding that sugar also causes obesity.”

COMMITTEE POSITION

In its own report, parliament’s Finance committee had recommended a three per cent reduction in the tax imposed on sodas to 10 per cent or Shs 157 per liter.

Committee chairman Henry Musasizi (Rubanda East) justified the recommendation, saying Uganda’s current tax rates on soda are the highest in East Africa, with Kenya charging seven per cent and Tanzania five per cent.

“This affects Uganda’s competitive advantage from the growth and investment point of view. In order to enable the sec- tor to attract investment and promote growth, the rate should be reduced,” explained Musasizi, who received the backing of Nathan Nandala-Mafabi (Budadiri West).

Mafabi said there was a lot of smuggling of low- taxed soda from Kenya. However, Opendi shot down Mafabi’s claims.

“There have been attempts by manufacturers to reduce tax and support the health sector through provision of equipment. We rejected it last year and now they are hinging it on smuggling,” she asserted.

Bahati warned that reducing taxes on soda will erode government’s revenue generation efforts. However, Bahati later agreed, albeit in a resigned tone, to retain the 20 per cent tax on confectioneries and asked the House to endorse the health minister’s proposals.

TAXES ON CIGARETTES

The House also approved a tax increment on locally manufactured and imported soft cup cigarattes. In the 2017/2018 financial year, locally manufactured soft cup cigarettes will be taxed Shs 55,000 per 1,000 sticks while imported soft cup will be taxed Shs 77,000 per 1,000 sticks.

For hinge lid cigarettes, importers will pay Shs 100,000 per 1000 sticks while locally manufactured ones will be maintained at Shs 80,000.

This is the second consecutive increase in the tax for soft cup and hinge lid cigarettes. During the last budget reading, finance minister Matia Kasaija imposed a Shs 50,000 tax on every 1,000 sticks of soft cup and Shs 80,000 per 1,000 sticks of hinge lids.

For alcohol, any brand whose local material content (excluding water) is at least 75 per cent will be taxed 30 per cent or Shs 650 per litre, compared to the Shs 700 which government had proposed.

Importers of undenatured spirits will face a 100 per cent or 2,500 per litre tax while those made from locally produced raw materials will be charged 60 per cent.

Other spirits will pay an 80 per cent tax while a 60 per cent or Shs 1,860 per litre tax has been maintained for malt beer.

Nigeria: Domestic Flight Operations Declined 67 Per Cent in First Quarter 2017

By Oladeinde Olawoyin

Domestic flight operations declined by 67 per cent in the first quarter of 2017, compared to the same period in 2016, the Nigerian Civil Aviation Authority, NCAA, has said.

The NCAA’s Consumer Protection Department, in a document on Monday, disclosed that 10,366 flights operated in the first quarter of 2017 compared to the 15,434 flights operated in 2016 by the same eight domestic airlines.

The domestic airlines, the agency said, are Aero Contractors, Arik Air, Air Peace, Azman Air, Dana Air, First Nation, Med-View and Overland.

Out of the 10,366 flights operated in the first quarter, there were 6 ,789 delays and 318 cancellations, the News Agency of Nigeria reports.

Air Peace, which operated 3, 262 flights, topped the chart of delayed flights with 2,036, while Arik Air recorded 1,059 delayed flights and 246 cancellations out of its 1,665 flight operations.

Dana Air, on its part, operated 1,525 flights with 1,017 delayed and five cancellations.

Meanwhile, the domestic airlines said that various factors militated against their successful operations in the country, which they listed to include high cost of aviation fuel, inadequate navigational aids and multiple charges by the various aviation agencies.

In his reaction, the President of the Airline Operators of Nigeria, AON, Nogie Meggison, said there was a need to create a more conducive environment for domestic airlines to thrive.

Mr. Meggison said that Nigerian carriers were restricted to daylight operations in most airports in the country while airlines in other West African countries operate 24 hours.

Allen Onyema, the Chairman of Air Peace, decried the issue of multiple charges imposed on the airlines, adding that it had put many of them out of business.

“If these taxes are not reduced , more airlines will crumble. No airline can survive this regime of taxes. Currently, we pay about 37 charges,” the Air Peace boss said.

He added that the taxes have been put in place before the present administration came on board and appealed to the government to streamline the charges as a form of support to the airlines.

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