East African Business Week

 
DAR ES SALAAM, TANZANIA - The Tanzania Revenue Authority (TRA) has launched the first Enterprise -wide Risk Management Policy and Framework (ERMF) to achieve equal treatment to taxpayers and enable TRA attain its vision of becoming a modern Tax Administration.
 Speaking during the launch, TRA Commissioner General Harry Kitillya said the objectives of having ERMF include to providing scope and guidance in setting priorities and decision making at corporate, departmental and regional levels.
 Others are to contribute to building a risk-smart workforce and environment that allows for innovation and responsible risk taking while ensuring that legitimate precautions  are taken to protect Government revenue, maintain public trust, and ensure due diligence.
 To propose a set of risk management practices that departments can adapt to their specific circumstances and mandate.
 "ERMF is fundamental for us as we are implementing the Third Corporate Plan (2008/9-2012/13), which has five strategic goals of which (goal No.4), is to promote Voluntary Tax Compliance. One of the initiatives under this goal is to introduce Enterprise-wide-Risk Management system," he explained.
 According to Kitillya, the kind of risk management introduced by TRA is the first among all Revenue Authorities in the East African Member States.
 Risk management process helps to identify and analyze the different steps in decision making process; that is to identify, assess and treat the attaching risks and hence facilitate explicit and better decisions in each stage of the process.
 "Our Enterprise-Wide Risk Management Policy statement states: "TRA shall adopt best practices in the identification, assessment, treatment, monitoring and evaluation of risks to ensure that they are minimized to an acceptable level.
This implies that risks embedded in TRA processes are minimized to an acceptable level in a cost effective way using both quantitative and qualitative risk assessment tools and methods.
 For TRA, Enterprise-wide Risk management is central in achieving equal treatment to taxpayers; focusing the burden of auditing to non-compliant taxpayers; best use of the available human, financial and technical resources and increased voluntary compliance of taxpayers.
 And the Policy's specific objectives are to ensure among others: collection of Government revenue is maximized by reducing risks in the areas of identifying potential taxpayers, assessing, collecting and accounting of taxes.
 However, TRA boss has told staff that when the authority is adopting a "risk Management culture" that emphasizes the importance of managing risks as part of each person's daylily activities to first and foremost exert their maximum efforts towards implementing the ERM Policy and Framework; to systematically manage risks and maximize opportunities in their area of responsibility consistently with the ERM Policy and Framework.
 The Risks that have been identified in the ERM Policy include those of strategic, reputation, compliance, information and communication technology and operational risks.