Industry Markets

Tanzania reads Tsh32.48 trillion Budget

BY DR. PHILIP I. MPANGO

MINISTER FOR FINANCE AND

PLANNING,

INTRODUCTION

  1. Honourable Speaker, I beg to move that this

Esteemed Parliament resolves to receive, debate and

approve the Government’s Revenue and

Expenditure Estimates for the year 2018/19. This

budget is presented in line with Article 137 of the

Constitution of the United Republic of Tanzania of

1977, together with Section 26 of the Budget Act

Number 11 of 2015.

  1. Honourable Speaker, together with this speech, I

submit four volumes of budget books: Volume I

presents the Revenue Estimates; Volume II presents

Recurrent Expenditure Estimates for Ministries,

Independent Departments and Government

Agencies; Volume III presents the Recurrent

Expenditure Estimates for Regional Secretariats and

Local Government Authorities; and Volume IV

presents the Development Expenditure Estimates for

the Ministries, Independent Departments,

Government Agencies, Regional Secretariats and

Local Government Authorities. In addition, the

Finance Bill, 2018 and the Appropriation Bill, 2018

are part of this budget.

  1. Honourable Speaker, it is a great honour and

privilege to stand before your august House to

2

present the third national budget of the Fifth Phase

Government. Therefore, first and foremost, I would

like to thank the Almighty God for continuing to

bless our country with abundant peace, harmony

and tranquillity and by enabling me to present the

National Budget to the Tanzania citizens for the

third time. Secondly, and without limit, I would like

to congratulate, the President of the United Republic

of Tanzania, H. E. Dr. John Pombe Joseph Magufuli,

our decisive leader, full of energy, trustworthy and

the leader who gives hopes to all Tanzanians,

particularly the poor; the dependable leader of

Tanzanians, the leader who hates and fights

corruption, graft and embezzlement of public assets

in practical terms; the distinguished President who

takes bold decisions of safeguarding the national

resources. I would like to congratulate the President

for the extraordinary job and glorious achievements

over a short period of two and half years in power. I

would like to mention only ten important things that

His Excellency has bravely implemented with great

fame:

(i) Relocating the Headquarters of the Central

Government to Dodoma: His Excellency has

blended into reality the dream of the Father of

the Nation, Mwalimu Julius Kambarage

Nyerere and the decision made by the ruling

3

party in 1972 of relocating the headquarters of

the central Government to Dodoma. In addition,

using the Constitutional powers of the

President, His Excellency has upgraded the then

Dodoma Municipal Council to City Council

with effect from 26th April 2018;

(ii) Constructing a Wall around Tanzanite Mines

in Mirerani: His Excellency constructed a wall

whose circumference is 24.5 kilometers around

Tanzanite Mines in Mirerani in Simanjiro

District at a cost of shillings 5.42 billion. The

main objective of constructing the wall around

the mines is to curb illegal mining and selling of

Tanzanite, which is exclusive to Tanzania and

brings revenue to the country. For the period of

three months starting from January – March

2018, the Government collected royalty

amounting to shillings 714.6 million, out of

which, shillings 614.6 million was collected from

artisan miners. The royalty collected from

artisan miners surpassed royalty collected

cumulatively for the past three years: shillings

116.8 million (2015); shillings 71.8 million (2016);

and shillings 147.1 million (2017);

4

(iii) Control of the Export of Mineral Concentrates

and Enactment of New Mining Laws: His

Excellency intervened in the shipment of 277

containers of mineral concentrates outside the

country, whose estimated value ranged from

shillings 829.4 billion to shillings 1,438.8 billion.

Moreover, His Excellency instructed enactment

of new mining laws, which will be a model in

Africa to enable countries with natural resources

to benefit from the resources. The laws passed

by the esteemed Parliament are:

  1. a) The Natural Wealth and Resources

(Permanent Sovereignty) Act, 2017;

  1. b) The Natural Wealth and Resources

Contracts (Review and Re-Negotiation of

Unconscionable Terms) Act, 2017; and

  1. c) The Written Laws – Miscellaneous

Amendments) Act, 2017.

(iv) Provision of Fee-free Basic Education and

Eight-fold Budget Increase for Medicines,

Medical Equipment and Reagents: His

Excellency has provided fee-free basic

education, whereas the Government pays

shillings 20.8 billion monthly. As a result,

enrolments for Standard One pupils have

increased from 1,568,378 pupils in 2015 to

2,078,379 pupils in 2018. Moreover, students’

5

enrolment for Form One has also increased from

448,826 students in 2015 to 562,695 in 2017.

Further, His Excellence increased the Higher

Education Students loans, whereas the

allocations in 2017/18 amounted to shillings

409.9 billion compared to the actual expenditure

of shillings 367.4 billion in 2015/16. Total

number of students receiving loans increased

from 96,589 in 2015 to 122,623 in 2017. In Health

Sector, His Excellency has braved to strengthen

health services by raising the budget to procure

medicines, immunization, equipment, medical

equipment and reagents to shillings 269 billion

in 2017/18 from shillings 31 billion in 2015/16;

(v) Procurement of New Aircrafts and Revamping

the Air Tanzania Company Limited (ATCL):

His Excellency has revamped the Air Tanzania

Company Ltd by taking bold decisions to

procure three new Bombardier Q400 Aircrafts

with the capacity of carrying 76 passengers each

that are already operating in the country by

making internal trips. Further, three (3) big

aircrafts, Boeing 787-8 Dreamliner with capacity

of carrying 262 passengers and two Bombardier

CS 300 aircrafts with capacity of carrying 132

passengers each, will be delivered later this

year. In addition, the Government completed

6

procedures to procure second new aircraft

Boeing 787-8 Dreamliner and initial down

payment has been paid.

(vi) Curbing of Unnecessary Expenditures,

Removal of Ghost Workers and those with

Forged Certificates: His Excellency has curbed

unnecessary expenditures especially foreign

travel for Government workers and removal of

19,708 ghost workers from payroll who were

being paid monthly salaries to the tune of

shillings 19.8 billion. Moreover, 14,404

Government workers with forged certificates

who were being paid shillings 15.5 billion

monthly were removed from the payroll.

Further, His Excellency, established the

Corruption and Economic Crimes Division of

High Court to fight those who are involved in

grand corruption practices, and under his

leadership, integrity of the civil servants has

improved remarkably;

(vii) Construction of Central Railway Line

(Standard Gauge Railway – SGR): His

Excellency has commissioned the construction

of Standard Gauge Railway. Phase one of the

project from Dar es Salaam to Morogoro (205

  1. km) and phase two from Morogoro to

Makutopora, Dodoma (422 km) are in progress.

7

The estimated cost of both phases is USD 3.14

billion;

(viii) Construction of Hydroelectric Power Project

at Rufiji River: His Excellency has embarked on

the construction of a huge hydro electric power

project at Rufiji River with capacity to generate

MW 2,100. This project was also a dream of the

Father of the Nation and is at its initial stage of

implementation;

(ix) To strengthen the management of domestic

revenue: His Excellency has fulfilled his

commitment to Tanzanians of improving

revenue collections and controlling tax evasion.

The measures have contributed to an increase in

revenue collections from an average of shillings

850 billion per month to an average of shillings

1.3 trillion at present; and

(x) Hastening of Rural Electrification and

stopping Independent Power Producers (IPPs):

His Excellency has continued with the

implementation of turnkey projects of supplying

electricity under REA Phase III, whereby in his

two and half years in office, a total of 557

villages were electrified. The villages are part of

implementation of REA II, REA III for

densification, backbone and Makambako –

Songea transmission lines. Moreover, His

8

Excellency suspended the implementation of the

IPPs that were costly to the Government.

Further, through his tireless efforts the

Government of Uganda was convinced, to

construct the major oil pipeline project from

Hoima – Uganda to Tanga Port – Tanzania, and

the project is now at implementation stage.

  1. Honourable Speaker, there are many

accomplishments by His Excellency (construction of

roads, bridges, ships, water supply, financial sector

supervision etc) but in the interest of time, I cannot

exhaust them all. All these are vivid evidences that

Tanzania, under the strong leadership of President

Magufuli, has gained development momentum. It is

therefore, the responsibility of each and every

Tanzanian to join the efforts of His Excellency in

building a modern Tanzania. To that end, each

Tanzanian should be patriotic, join the war against

theft, embezzlement of public resources and graft, as

well as working hard and paying Government taxes.

  1. Honourable Speaker, along with these honest

congratulations to our President, I would like to

sincerely thank His Excellency for continuing to trust

and guide me when discharging my duties as the

Minister for Finance and Planning. Even when I was

overwhelmed by assignments and blames that this

Minister is stingy in releasing funds and others

9

calling me an arrogant minister, His Excellency

encouraged me. I once asked President as to why

His Excellency decided to give me such a

burdensome job like a concrete cross and without a

hope of seeing a person like Simon of Kirene in the

Holy Bible to help me. The President responded to

me that “God will send His angels to help me!” and

added that few of us should be ready to suffer for the

benefit of poor Tanzanians who are the majority. Further,

let me be honest that, the words from His Excellency

irradiated and reminded me the prayer from “opus

Dei” in hardship which says… “let the will of God the

most righteous and pleasing, be done, fulfilled, praised

and glorified above all things forever and ever. Amen”.

Amen. After this remembrance of prayer and

comforting words of His Excellency, I became

rejuvenated to continue serving in a position

assigned to me. I thank you Mr. President. I know

you are listening!

  1. Honourable Speaker, I would like also to

congratulate Hon. Samia Suluhu Hassan, the Vice

President of the United Republic of Tanzania, for

assisting the President to exercise wisdom in leading

the Nation. Likewise, I would like to congratulate

H.E. Dr. Ali Mohamed Shein, the President of the

Revolutionary Government of Zanzibar and the

Chairperson of the Revolutionary Council for

leading Zanzibar wisely, which has lead the people

10

of Zanzibar to live in peace and harmony for the

period of seven and a half years to date. Moreover,

let me take this opportunity to congratulate Hon.

Kassim M. Majaliwa, the Prime Minister of the

United Republic of Tanzania, who is also the

Member of Parliament for Ruangwa Constituency,

for being a strong captain of the Government Team

in the Parliament and for helping the President in

following up the implementation of the Ruling Party

CCM Manifesto of 2015 – 2020. Further, I wish to

congratulate other heads of National Organs,

starting with you Hon. Job Yustino Ndugai, Speaker

of the National Assembly of Tanzania and Member

of Parliament for Kongwa Constituency, in leading

this Esteemed House judiciously; Hon. Professor

Ibrahim Hamis Juma, Chief Justice of Tanzania, for

excellent job of leading this important organ of

giving justice. Furthermore, I would also like to

congratulate Honourable Ambassador Eng. John

Kijazi, Chief Secretary, who is also the Head of Civil

Service and Cabinet Secretary, for his seasoned

service to the Government.

  1. Honourable Speaker, let me also congratulate the

honorable spouses of our national leaders for their

special importance. Allow me to mention them by

their names: Mwalimu Janeth Magufuli, Mr. Ameir

Hafidh Ameir, Mama Mwanamwema Shein,

Mwalimu Mary Majaliwa, Dr. Fatuma Ramadhani

11

Mganga, and Mama Marina Papadopoulos Juma.

We congratulate and thank them for enabling our

national leaders to perform their duties in harmony,

excitement and smile from great love they are

providing to them at homes.

  1. Honourable Speaker, I wish to congratulate and

thank all heads of defence and security organs

starting with General Venance Mabeyo, Chief of

Defence Forces; Simon Siro, Inspector General of

Police; Dr. Juma Ali Malewa, Commissioner General

of Prison; Dr. Anna Makakala, Commissioner

General of Immigration; Dr. Modestus Kipilimba,

Director of Intelligence and Security Services; Mr.

Valentino Mlowela, Director General of the

Prevention and Combating of Corruption Bureau;

Mr. Rogers William Sianga, Commissioner General

of Drugs Control and Enforcement Authority; and

Mr. Thobias Andengenye, Commissioner General of

Fire and Rescue. My fellow Tanzanians and I are

sincerely congratulating these leaders, together with

commanders, officers and staff of the respective

institutions for being strong and capable of

maintaining peace, security, hence enabling all

Tanzanians to continue harmoniously with their

development activities. Likewise, I wish to

congratulate Honorable Dr. Adelardus Lubango

Kilangi for being appointed by the President to the

post of Attorney General. I also thank him for the

12

preparation of the 2018 Finance Bill, and the 2018

Appropriation Bill on time.

  1. Honourable Speaker, Let me take this opportunity to

offer my specific thanks to the Parliamentary

Standing Committee for Budget headed by

Honourable Hawa Abdurahman Ghasia, Member of

Parliament for Mtwara Rural Constituency and her

deputy, Hon. Jitu V. Soni, Member of Parliament for

Babati Rural Constituency. Opinions and advices

given by the Budget Committee during the analysis

of the budget proposals which I am presenting

before your Esteemed House were nationalistic and

highly valued. In addition, I am congratulating all

chairpersons, vice chairpersons, and all Members of

the Standing Committee for their contributions

made through sectoral committees in improving the

2018/19 Government Revenue and Expenditure

Estimates, in order to provide quality services to

Tanzanians.

  1. Honourable speaker, as it was in 2017/18, the theme

of the 2018/19 Budget for all East African Countries

will be “to build an industrial economy that will

stimulate employment and sustainable social

welfare”. This budget has been prepared basing on

the situation of our country which we all know, in

the sense of major economic and social challenges

we are facing, opportunities available, achievements

13

todate and our National goals. Let me briefly

explain the following:

  1. a) Challenges

(i) We still have high level of poverty, whereby the

data from the National Bureau of Statistics

shows that the level of poverty has slightly

decreased from 28.2 percent as of 2012/13 to 26.4

percent as of 2015/16. Expectations from the

ongoing Household Budget Survey will avail

better information on the decrease of the level of

poverty, taking into consideration that the

economy is growing at an average rate of 7.0

percent per annum over the last two decades;

(ii) Limited employment opportunities especially

for the youth, whereby statistics show that 10.4

percent of Tanzanians are unemployed. In

addition, out of 800,000 graduates per annum,

only 40,000 are employed;

(iii) Agricultural sector (which includes crops,

livestock and fisheries) which employs 66

percent of the population and contribute 30

percent to GDP continued to record slow growth

at an average of 3.7 percent annually over the

past 10 years due to low level investment, low

productivity and dependence on rainfall, as well

as low contribution of manufacturing sector to

14

GDP of 5.5 percent;

(iv) High demand for social services (especially

water, health and better education) due to

population growth (3.1 percent per annum).

Further, the state of energy infrastructure,

transport and transportation (roads, railway, air

and marine) still does not cater for the needs of

the fast and inclusive economic growth. For

example, the roads network is 86,472 km

whereby only 9.7 percent are at tarmac standard.

Furthermore, electricity demand for domestic

and industrial uses outpaces the generation

capacity; the existing plants have the generation

capacity of 1,424.6 MW compared to the high

demand of 3,000 MW for enduring the industrial

economy; and

(v) Narrow tax base whereby the ratio of domestic

revenue to GDP is almost 15.0 percent compared

with 17.0 percent for Sub-Saharan African

Countries.

  1. b) Opportunities
  2. Honourable speaker, the preparations of this budget

have taken into account various national

opportunities that are available in the country

especially huge labour force of the youth generation;

vast agricultural resources (crops, livestock and

15

fisheries); minerals; gas; tourist attractions; agribusiness;

electricity generation potential; business

and cargo transportation service to neighbouring

countries.

  1. c) Achievements
  2. Honourable speaker, this budget has also taken into

consideration achievements todate, which we are

obliged to strengthen and I will explain it in a

summary in the section review of the budget

implementation.

  1. d) Goals
  2. Honourable speaker, this budget has also been

prepared in accordance with the Tanzania

Development Vision 2025; National Five Years

Development Plan 2016/17 – 2020/21 and the CCM

Manifesto 2015 – 2020. The main goals are poverty

eradication, transforming Tanzania into an

industrial economy and Tanzania endeavour to be a

middle income country by 2025.

  1. Honourable speaker, the challenges, opportunities,

achievements and goals which I have just explained

above must go in tandem with Government, Private

Sector, other stakeholders and individuals taking

responsibilities in providing solutions to those

challenges and contributing to efforts in making our

16

nation to prosper. We will do that if every citizen

will work hard and exhaust his/her full capacity for

his/her own development and for the nation.

Moreover, it is crucial to continue building and

harnessing strategic partnerships. My message to all

Tanzanians through this budget is that we must

continue making tough choices in allocating scarce

resources we mobilize in order to overcome the

challenges ahead of us. The fact is that changes are

tough and are quite often opposed; therefore, we

must be strong and strive to succeed and utilize

opportunities and potentials of Tanzanians, Private

Sector and Government to achieve our goals.

  1. Honourable speaker, in the speech I read in the

morning today, I explained in detail the state of our

economy in 2017, implementation of the 2017/18

Annual Development Plan, our achievements and

challenges encountered as well as priority areas for

2018/19. In this speech, I will focus more on budget

issues, starting with the implementation of the

2017/18 budget, expenditure measurers that will be

taken in the coming financial year, reforms in the tax

system and various levies and the 2018/19 budget

recommendations.

  1. REVIEW OF 2017/18 BUDGET IMPLEMENTATION

Revenue Trend

  1. Honourable Speaker, the amount of resources

mobilized during the period of July 2017 to April

2018 was shillings 21.89 trillion, equivalent to 69.0

percent of annual target of shillings 31.71 trillion.

The sources of revenue details are as follows:

  1. Domestic Revenue
  2. Honourable Speaker, domestic revenue including

Local Government Authority (LGAs) own sources

amounted to shillings 14.84 trillion compared with

the annual target of shillings 19.98 trillion equivalent

to the performance of 74.3 percent. Out of that, Tax

revenue amounted to shillings 12.61 trillion, Non tax

revenue was shillings 1.79 trillion; and LGAs own

source was shillings 437.6 billion. The

underperformance in domestic revenue was a result

of the following challenges:

(i) Tax evasion;

(ii) Difficulties in collecting tax/levy from informal

sector since participants have no formal and

permanent locations and do not keep records of

their transactions;

(iii) Unfriendly environment for tax payment and

18

imposition of numerous tax and levies especially

for services rendered by regulatory authorities

(including TBS, TFDA, EWURA, TCRA, OSHA,

Fire and Rescue Force); high tax rates,

unnecessary bureaucratic procedures in tax

compliance and high cost of paying tax;

(iv) Underutilization of Electronic Fiscal Devices

(EFD);

(v) Weakness in the management of natural

resources extraction particularly minerals,

natural gas, forestry, aquatic resources, tourism

and land; and

(vi) Low contribution and dependency of public

corporations to the Government budget.

  1. Domestic and External Non Concessional Loans
  2. Honourable Speaker, Government borrowed

shillings 4.96 trillion from domestic markets

equivalent to 80 percent of the annual target of

shillings 6.17 trillion that was expected to be

borrowed in the year 2017/18. Out of this amount,

shillings 4.13 trillion was for rollover of matured

Treasury bills and bonds, and shillings 832.3 billion

was for financing various development projects.

Moreover, the Government borrowed from external

sources shillings 1.35 trillion equivalent to 84

19

percent of the annual target of shillings 1.6 trillion.

These funds have been allocated to various strategic

development projects. Further, in May 2018, the

Government has managed to secure non

concessional loan amounting to shillings 1.13

trilllion.

  1. Grants and Concessional Loans from Development

Partners

  1. Honourable Speaker, grants and concessional loans

received from Development Partners (DPs)

amounted to shillings 1.87 trillion equivalent to 47

percent of annual target of shillings 3.97 trillion.

Out of the received amount, shillings 70.2 billion

was General Budget Support (GBS) equivalent to

7.5 percent of the target of shillings 941.3 billion,

shillings 182.9 billion was Basket Funds equivalent

to 33 percent of the target of shillings 556.1 billion,

and shillings 1.61 trillion was Projects Grants and

Concessional Loans equivalent to 65 percent of the

target of shillings 2.47 trillion.

Expenditure Trend

  1. Honourable Speaker, for the period of July, 2017 to

April 2018, the Government released shillings 21.68

trillion equivalent to 68.4 percent of the annual

target of shillings 31.71 trillion for recurrent and

development expenditures. Out of that amount,

20

shillings 16.56 trillion was for recurrent expenditure

including shillings 5.63 trillion for wages and

salaries for Government employees and shillings

8.42 trillion was for Government Debt Services and

General Services.

  1. Honourable Speaker, as of April 2018, the

Government released shillings 5.12 trillion for the

implementation of development projects out of that

shillings 4.35 trillion was local funds and shillings

775.8 billion was foreign funds. However, foreign

funds do not include funds from Development

Partners which were directly disbursed to the

projects outside the exchequer system; the funds

will be accounted for when the accounting

procedures are completed.

  1. Honourable Speaker, let me explain the

achievements realized from the implementation of

the 2017/18 budget for the period from July 2017 to

April 2018 as follows:

(i) A total of shillings 59.0 billion has been released

to 110 Districts Councils for construction and

rehabilitation of Health Centres, and shillings

24.1 billion for the rehabilitation of 24 Regional

Hospitals. In addition, a total of shillings 125.7

billion has been released for procurement of

medicines, medical equipment and reagents;

21

(ii) Shillings 156.1 billion has been released for the

implementation of urban and rural water

projects;

(iii) Shillings 409.9 billion has been released for rural

energy projects, geothermal power, generation

of electricity from various sources and

distribution of natural gas;

(iv) In implementing fee free basic education and

granting loans to higher education students, a

total of shillings 618.0 billion has been released;

(v) The Government has continued with

construction of infrastructure in order to open

economic opportunities, agriculture, trade and

industries including roads that link regions as

well as neighbouring countries, roads that

decongesting cities, rural roads, railways,

airports and ports. In this area a total of shillings

1.87 trillion has been released; and

(vi) Government has continued to pay arrears to

employees, suppliers, contractors and service

providers amounting to shillings 1.17 trillion.

  1. Honourable Speaker, the Government has also

continued to take other measures to strengthen

management of Government budget as follows:

22

  1. a) Public Debt
  2. Honourable Speaker, in order to ensure proper

management and sustainability of the public debt,

the Government continue to manage the public

debt in accordance to Government Loans,

Guarantees, and Grants Act, CAP 134. Moreover,

the Government is implementing the Medium Term

Debt Strategy that guides on how to raise the

appropriate amount of funding at the lowest

possible cost consistent with low degree of risk in

managing public debt. In controlling rising cost of

borrowing, the Government focused to borrow on

semi concessional window, particularly, through

Export Credit Agency (ECA), and where it was

necessary to borrow from commercial sources a

great caution was made to ensure that loan

proceeds were directed into areas that stimulate

economic growth.

  1. Honourable Speaker, up to April, 2018 the Public

Debt Stock was shillings 49.65 trillion equivalent to

an increase of 13.4 percent compared to shillings

43.79 trillion recorded in April, 2017. Out of this

stock, domestic debt was shillings 14.05 trillion and

external debt was shillings 35.60 trillion equivalent

to 71.71 percent of the total debt. The increase was

mainly due to the disbursement of outstanding

loans from either concessional or non-concessional

23

as well as accumulation of interest arrears of

external debt particularly from Non-Paris Club

Member countries where the Government continue

to negotiate for debt relief in accordance with the

Paris Club Agreed Minutes.

  1. Honourable Speaker, concessional loans from the

International Financial Institutions have continued

to be the main source of external loans which

contributed 59.6 percent of the total external debt.

Commercial loans contributed 28.5 percent, while

loans from the Bilateral Partners contributed 11.9

percent. These loans were used to finance various

development projects.

  1. Honourable Speaker, the Government debt has been

increasing. Nevertheless, this debt is still

sustainable and its growth is aligned with economic

growth. The Debt Sustainability Analysis (DSA)

which was conducted in November, 2017 revealed

that the debt is sustainable in medium and long

term. The ratio of present value of public debt to

GDP was 34.4 percent against the threshold of 56

percent; the present value of external public debt to

export was 81.8 percent against the threshold of 150

percent; the present value of external public debt to

domestic revenue was 117.1 percent compared to

the threshold of 250 percent; the debt services to

export was 9.3 percent compared to the threshold of

24

20 percent; and external debt service to domestic

revenue was 13.3 percent compared to threshold of

20 percent. Let me again emphasize that it is not a

sin if the country borrows prudently. The most

important issue is to ensure that loans are utilized

to increase productive capacity and in turn the

economy be able to repay loans in accordance with

the ability of the economy to sustain the debt

burden.

  1. b) Control of Government Arrears
  2. Honourable Speaker, the Government has been

taking various measures to reduce accumulation of

arrears which include to set aside funds in the

budget for payment of arrears every year; to

emphasize compliance with Laws and Regulations

such as: the Budget Act No. 11 of 2015; the Public

Finance Act CAP 348; the Public Procurement Act

CAP 410; and its corresponding issuance of

directives and circulars such as the annual

Paymaster General Circular No. 1 on the

implementation of the budget, Plan as well as

Budget Guidelines issued annually.

  1. Honourable Speaker, in addressing the challenge,

the Government has developed a strategy for the

payment of verified arrears and check further

accumulation. A kind of arrears which will be

25

considered in this strategy are those of MDAs, RSs

which covers employees’ arrears, bidders and

service providers, as well as arrears of contractors.

The government will continue to set aside funds in

the budget to pay for verified arrears based on the

roadmap to pay the debts until it reaches the

preferred level. In making payments of arrears, the

priority will be given to arrears that cover majority

of service providers and those may grow due to

interest payments.

  1. Honourable Speaker, the strategy requires all

Accounting Officers to participate fully in its

implementation to enable the Government to

achieve its objectives of controlling accumulation of

arrears and provide timely delivery of services to

the people. Therefore, in ensuring no new arrears

are generated each Accounting Officer is required

to observe the following:

(i) All contracts of infrastructure construction

adhere to approved budget of respective Vote.

Moreover, the respective Vote should not enter

into new contracts without the approval of the

Pay Master General; Similarly, Section 51 (1) and

(2) of the Budget Act No. 2015, stipulates that

Multi-annual Commitments shall seek prior

approval from Minister for Finance and

Planning, adhering to budget ceilings and that

26

payment of these contracts should not exceed

the approved budget by the Parliament, and

effect the payments after verification;

(ii) Prioritize completion of ongoing projects before

embarking on new projects and ensure that

funds are allocated to ongoing projects;

(iii) Accounting Officers are not entering into a

contract for provision of goods or services

without written approval from the Pay Master

General; and commitments should be generated

from IFMS;

(iv) The claims of all service providers and

contractors should be made after obtaining Local

Purchasing Order (LPO) generated from the

IFMS in line with approved budget as well as the

existence of an Exchequer Releases for the

relevant expenditure items. Therefore, the

Government insists that only LPOs generated

from IFMS should be used as a basis for any

payment to the service provider; and

(v) Obedience on application of Budget Act No. 11

of 2015, the Public Finance Act, CAP 348 the

Public Procurement Act CAP 410 and circular

issued by the Pay Master General during

implementation of the Budget.

27

III. FISCAL POLICIES FOR 2018/19

Macroeconomic Policy Targets

  1. Honourable Speaker, macroeconomic targets for

2018/19 budget are as follows:

(i) Attain real GDP growth of 7.2 percent in 2018 up

from the actual growth of 7.1 percent in 2017;

(ii) Continue to contain inflation at single digit;

(iii) Domestic revenue including LGA’s own sources

is projected at 15.8 percent of GDP in 2018/19 up

from the likely outturn of 15.3 percent in

2017/18 and the actual outturn of 15.6 in

2016/17;

(iv) Tax revenue is estimated at 13.6 percent of GDP

in 2018/19 up from the estimate of 13.0 percent

in 2017/8 and the actual outturn of 13.3 percent

in 2016/17;

(v) Total Government expenditures are projected at

24.5 percent of GDP in 2018/19 from the

estimate of 23.0 percent in 2017/18 and the

actual performance of 22.2 percent in 2016/18;

(vi) Budget deficit to be 3.2 percent of GDP in

2018/19 compared to the likely outturn of 2.1

percent in 2017/18 and the actual deficit of 1.5

percent in 2016/17;

28

Policy and Strategies to Increase Revenue

  1. Honourable Speaker, in order to increase and

strengthen domestic resources mobilization,

revenue policies for the year 2018/19 will focus on

widening tax base; strengthen management of from

existing sources especially by intensifying the use of

electronic collection systems and other

administrative measures.

  1. Honourable Speaker, in widening the tax base, there

are two main measures that the Government will

undertake, namely formalization of the informal

sector and improve investment environment in

order to foster new sources of revenue from such

investments. Some of the formalization measures

being implemented by the Government are such as

land surveys and valuation of properties that is in

progress throughout the country. The Government

will enhance formalization efforts by using creative

measures which are friendly, participatory and

strategic ones.

  1. Honourable Speaker, conducive environment is the

basis of attracting business and investment

including improvement of supportive

infrastructure, tax incentives, policy consistency

and predictability, land accessibility and well

structured legal and regulatory frameworks. As

long as there is conducive environment, it caters for

29

increased investments, production, employment

and business transactions will increase, leading to

new sources of revenue.

  1. Honourable Speaker, analysis that was undertaken

by the Government in 2017/18 revealed the

following challenges concerning investment and

business environment:

(i) Conflicting laws, regulations and procedures

administered by different authorities;

(ii) High start-up and operating business costs due

to multiplicity of taxes, fees and levies

accompanied by complex and unproductive

bureaucratic procedures and thus resulting into

corruption practices; and

(iii) Overlapping of responsibilities and multiplicity

of regulatory authorities in approving, licensing,

granting permits and certificates in business and

investments.

  1. Honourable Speaker, following that analysis, the

Government prepared a Blueprint for Regulatory

Reform to Improve Business Environment for Tanzania.

The recommendations of the Blueprint which

strongly proposed to be implemented in the

financial year 2018/19 include: simplification of

payment of taxes, levies and different fees, and to

30

shorten time and bureaucratic procedures in

registration of businesses and companies. The Fifth

Phase Government believes that sustainable

development can only be achieved expeditiously in

an environment where there is sincere public and

private sector cooperation.

  1. Honourable Speaker, in strengthening

management of the existing revenue sources, the

Government will continue to connect Ministries,

Departments, Agencies, Institutions and Parastatal

Organization with the Government Electronic

Payment Gateway System (GePG) in order to

improve revenue collection and control of leakage

Government revenues. The system was developed

in 2017 and endorsed by Parliament through

amendments of the Public Finance Act, CAP 348,

requiring all the Government Institutions to collect

the revenues using GePG. As of May 2018, a total of

234 Government institutions which collect non tax

revenue including all 185 Councils have already

been connected to the system. I would like to take

this opportunity to direct all the remaining LGAs,

MDAs and Institutions to ensure that they are

connected to the GePG by June 2019. Apart from

using the GePG, I would like to remind all

Accounting Officers to ensure the use of EFDs and

banks in non-tax revenues collection instead of

manual exchequer receipt vouchers.

31

  1. Honourable Speaker, regarding administrative

measures to raise the Government revenue, I direct

the following:

(i) TRA should take deliberate measures to enhance

relationship with taxpayers in order to clear

misconception that TRA uses forces and threats

in collecting taxes;

(ii) Office of Treasury Registrar should strengthen

administration and inspection to companies of

which Government is a shareholder to ensure

that the Government earns appropriate

dividends from its investments; and

(iii) LGAs should focus on projects that can generate

revenues in their localities especially industries,

markets, modern abattoirs, bus stands, heavy

trucks parking lots at the borders and

warehousing facilities.

Strengthen Cooperation with Development Partners

  1. Honourable Speaker, grants and concessional loans

have been declining from an average of 26.3 percent

of the actual budget in 2010/11 to 10.4 percent in

2016/17. In order to ensure sustainable

development and timely disbursement of loans and

grants as committed, the Government in

collaboration with Development Partners and other

32

stakeholders prepared the framework for

development cooperation. The framework was

endorsed by the Government in August 2017

putting in place:

(i) General principles of governing cooperation

which includes government to provide guidance

in setting up of development project priorities;

and

(ii) System of dialogue which will be in three levels:

National Strategic dialogue, Sectoral dialogue

and dialogue with political inclination.

Expenditure Policies

  1. Honourable Speaker, the expenditure policies for

the year 2018/19 will include:

(i) Ensuring that the budget deficit does not exceed

3.2 percent of GDP;

(ii) Allocation of funds to priority areas and

productivity in order to stimulate growth in

agriculture and industries, widen job creation

opportunities, construct and improve economic

infrastructure, and strengthen the provision of

quality social services;

(iii) Ensuring discipline in the use of public funds

and continue to reduce unnecessary

expenditure; and

(iv) Control accumulation of arrears.

33

  1. Honourable Speaker, in implementing these

policies, the Government will take the following

measures:

(i) Take disciplinary actions, legal and

administrative measures to those who will

contravene the laws and regulations governing

their institutions. Once again, I would like to

remind them that, embezzlement of public

project funds is the same as poisoning yourself –

do not dare!!

(ii) Ensure that Accounting Officers do not award

contracts without assurance of funds or prior to

approval of the Paymaster General and control

expenditure and commitment to spend outside

IFMS, in order to control accumulation of

arrears;

(iii) To align actual revenue with expenditure on

monthly basis;

(iv) To honour payments of verified arrears;

(v) Ensure public procurement realizes Value for

Money; and

(vi) To strengthen monitoring of public funds

expenditure as planned.

34

Priority Areas for 2018/19

  1. Honourable Speaker, as highlighted in the Annual

Development Plan 2018/19 which I presented today

in the morning, the 2018/19 budget will put more

emphasis on implementation of flagship projects;

interventions for fostering human development;

and interventions to create a conducive

environment for investment and business.

  1. Honourable Speaker, priority areas in this budget

are as follows:

(i) Agriculture: More funds will be allocated in

improving irrigation infrastructure, warehouses

and markets, strengthening supply of

agricultural inputs and implement, improving

extension services, improving researches and

dissemination of findings to the people and

development of livestock and fisheries sub

sectors. Emphasis has been put on this sector

due to the fact that it is the source of livelihood

to majority of people and provides raw materials

for industries, ensures food security and

increases of income to the citizens;

(ii) Industries: In a bid to stimulate industrial

development, the Government will direct more

efforts in the implementation of a Blueprint for

Regulatory Reform to Improve Business

35

Environment for Tanzania in order to attract

private sector investments particularly in

textiles, leather and meat, fish, edible oil,

medicines and medical equipment, food and

animal feeds and in mining sector. Moreover,

agricultural and industrial development should

take into account environmental sustainability.

(iii) Social Services: Water: Another important area

is to increase availability and distribution of

clean water particularly in villages and sewerage

systems, drilling of boreholes in arid and semiarid

areas and construction of strategic dams.

Education: The Government will continue to

finance fee free basic education, increasing

number of experts in rare and specialized skills

in areas of minerals, oil and gas, specialist

doctors (cardiologists and kidney specialists) as

well as provision of loans to higher education

students. Heath: Financial resources will be

allocated to increase distribution of medicines,

medical equipment and reagents in health

centres, dispensaries and referral hospitals.

Moreover, in the next financial year the

Government will allocate more funds from

LGCD in development projects which are

implemented by councils especially health and

education. Further, the Government will put

more emphasis on the improvement of

36

availability of quality food to mothers and

children especially for the first 1,000 days from

conception in order to overcome the challenge of

stunted growth hence to have well developed

body and mind. Furthermore, the needs of

special groups within our society (women,

youth, children, disabled and the elderly) will

continue to be attentively cared;

(iv) Construction and rehabilitation of supportive

infrastructure especially increasing electricity

generation from different sources; to continue

with the construction of new central line railway

of the standard gauge; construction of roads

connecting regions and rural roads; to improve

air and marine transport; and

(v) Other priorities include ease of land acquisition

and ownership; to improve communication

services; finance and tourism and to improve

defence and security, good governance and

justice.

REFORMS OF THE TAX STRUCTURE, FEES,

LEVIES AND OTHER REVENUE MEASURES

New revenue measures for the year 2018/19

  1. Honourable Speaker, I would like to propose

undertaking reforms in the tax structure that will

include amendments to the tax rates, levies and fees

imposed under various laws governing revenue

collection and administration procedures. The

amendments are intended to, among other things,

increase Government revenue and accelerate

economic growth particularly in the industrial and

tourism sectors and also promote employment.

Furthermore, the amendments take into account the

Government intention to continue maintaining the

tax system which is consistent and predictable. The

proposed amendments will cover the followings tax

laws:-

  1. a) The Value Added Tax Act, CAP 148;
  2. b) The Income Tax Act, CAP 332;
  3. c) The Excise (Management and Tariff) Act,

CAP 147;

  1. d) The Local Government Finance Act, CAP

290;

  1. e) The Tax Administration Act, CAP 438;
  2. f) The Local Government Finance Act, CAP

290; The Public Finance Act, CAP 348; and

The Bank of Tanzania Act, CAP 197;

38

  1. g) The East African Community Customs

Management Act, 2004;

  1. h) The Laws Governing the Operation of Crop

Boards;

  1. i) The Gaming Act, CAP 41;
  2. j) Minor amendments in tax laws and other

laws; and

  1. k) Amendment of various fees and levies

imposed by Ministries, Regions and

Independent Departments.

A.The Value Added Tax Act, CAP 148

  1. Honourable Speaker, I propose to make

amendments in the Value Added Tax Act, CAP 148

as follows:-

(i) To exempt Value Added Tax on packaging

materials produced specifically for use by the

local manufacturers of pharmaceutical products.

The packaging materials must be printed or

labeled with the name of the local

pharmaceutical company in order to control

abuse. This measure is aimed at reducing

production costs and protecting local

pharmaceutical industries;

(ii) To exempt Value Added Tax on imported

animal and poultry feeds additives. This

measure is intended to reduce costs incurred by

39

livestock keepers and increase the contribution

of the sector to the economy;

(iii) To amend section 6(2) (a) of the Value Added

Tax Act, in order to give powers to the Minister

responsible for Finance to provide VAT

exemption on Government projects funded by

non-concessional loans. Currently, the Value

Added Tax Act do not provide VAT exemption

on such projects, therefore causing delays in the

implementation of Government priority projects

such as water, and infrastructure projects. The

proposed amendment, is therefore expected to

contribute to timely completion of projects;

(iv) To amend section 6(2) (a) of the Value Added

Tax Act in order to give powers to the Minister

responsible for Finance to provide VAT

exemption when there is an agreement signed

between the Government and a Financial

Institution or Bank that is representing another

Government and has been given powers of

Attorney by the said Government to execute the

Agreement. Currently, the VAT Act allows the

Minister responsible for Finance to provide VAT

exemption when there is Agreement between

the Government and another Government and

does not recognize Financial Institutions or

Banks. This has been affecting the

implementation of Government projects such as

40

Water and Infrastructure projects. The proposed

amendment will therefore allow for smooth

implementation of these projects;

(v) To exempt VAT on Sanitary Pads (HS Code

9619.00.10). This measure is intended to make

the product available and affordable to women

and girls, particularly school girls and those in

the village. It is the Government expectation that

the producers and sellers of sanitary pads will

make them available at affordable prices; and

 

The VAT measures altogether are expected to reduce

Government revenue by shillings 219.1 million.

  1. The Income Tax Act, CAP 332
  2. Honourable Speaker, I propose to make

amendments in the Income Tax Act, CAP 332 as

follows:-

(i) To amend the Income Tax Act in order to reduce

the Corporate Income Tax rate from 30 percent

to 20 percent for new investors in the

Pharmaceutical and Leather industries for five

years starting from year 2018/19 up to 2022/23.

The Government will sign a Performance

Agreement with investors to assign

responsibilities of both parties. The measure is

41

expected to promote investment in the

manufacturing of pharmaceutical and leather

products, create employment opportunities and

increase Government revenue. Furthermore, it is

also expected to save foreign exchange which is

currently being used for the importation of these

products,

(ii) To delete section 10A of the Income Tax Act

which prohibits the Minister responsible for

Finance from providing income tax exemption to

Government projects financed by nonconcessional

loans. This measure is intended to

give powers to the Minister to exempt income

tax when there is Agreement which provides for

such exemption; and

(iii) To amend the Income Tax Act in order to

provide Withholding tax exemption on interest

on Government Loans provided through Banks

and Financial Institutions to finance

Government projects;

The Income Tax measures altogether are expected

to increase Government revenue by shillings 220.5

million.

42

  1. The Excise (Management and Tariff) Act, CAP

147

  1. Honourable Speaker, According to the Excise Tax

(Management and Tariff) Act, CAP 147 Section

124(2), the specific excise duty rates may be

annually adjusted in accordance with the projected

inflation rate and other key macroeconomic

indicators. However, in order to implement the fifth

Government strategy of building an industrial

economy, I propose to retain the current excise duty

rates imposed on locally produced non-petroleum

products and increase the excise duty rates for

imported non-petroleum products as follows:-

  1. i) Excise Duty on soft drinks remains at

shillings 61 per litre;

  1. ii) Excise Duty on imported water including

mineral waters containing added sugar or

other matter of flavour will increase from

shillings 61 per litre to shillings 64.05 per

litre, which is an increase of shillings 3.05 per

litre. The Excise Duty on locally produced

water remains at shillings 58 per litre;

iii) Excise Duty on locally produced fruit juices

remains at shillings 9 per litre;

43

  1. iv) Excise Duty on imported fruit juices will

increase from shillings 221 per litre to

shillings 232 per litre which is an increase of

shillings 11 per litre;

  1. v) Excise Duty on beers made from local

unmalted cereals remains at shillings 450 per

litre;

  1. vi) Excise Duty on imported beers will increase

from shillings 765 per litre to shillings 803.25

per litre which is an increase of shillings 38.25

per litre;

vii) Excise Duty on imported non-alcoholic beers

(including energy drinks and non-alcoholic

beverages) will increase from shillings 561

per litre to shillings 589.05 per litre, which is

an increase of shillings 28.05 per litre. The

excise duty on non-alcoholic beers (including

energy drinks and non-alcoholic beverages)

produced locally remains at shillings 561 per

litre;

viii) To introduce an Excise duty of shillings

200 per litre on wine produced with domestic

fruits (such as banana, rozera, tomato e.t.c)

other than grapes with contents of at least 75

percent;

44

  1. ix) Excise Duty on wine produced with domestic

grapes with content exceeding 75 percent

remains at shillings 200 per litre;

  1. x) Excise Duty on wine produced with more

than 25 percent imported grapes will increase

from shillings 2,349 per litre to shillings 2,466

per litre which is an increase of shillings 117

per litre;

  1. xi) Excise Duty on imported spirits will increase

from shillings 3,481 per litre to shillings

3,655.05 per litre which is an increase of

shillings 174.05 per litre. The Excise Duty on

locally produced spirits remains at shillings

3,315 per litre;

xii) Excise Duty on cigarettes without filter tip

and containing domestic tobacco more than

75 percent remains at shillings 12,447 per

thousand cigarettes;

xiii)Excise Duty on cigarettes with filter tip and

containing domestic tobacco more than 75

percent remains at shillings 29,425 per

thousand cigarettes;

xiv)Excise Duty on other cigarettes not

mentioned in (xii) and (xiii) will increase

from shillings 53,235 to shillings 55,896.75 per

thousand cigarettes, which is an increase of

45

shillings 2,661.75 per thousand cigarettes;

  1. xv) Excise Duty on cut rag or cut filler will

inrease from shillings 26,888 to shillings

28,232.4 per kilogram which is an increase of

shillings 1,344.4 per kilogram; and

xvi)Excise Duty on cigar remains at 30 percent.

  1. Honourable Speaker, I propose to introduce

Electronic Tax Stamp to replace the Paper Tax

Stamp starting from 1st September 2018. The new

tax stamp system will enable the Government to

use a modern technology to obtain production data

on timely basis (real time) from the manufacturers.

It is also intended to curb revenue leakages and

make it possible to determine in advance the

amount of taxes to be paid namely Excise Duty,

VAT and Income Taxes. Furthermore, the system

will address the challenges associated with the use

of fake paper stamps including the sub-standard

products which may result to health problems and

revenue loss.

The Excise Duty measures altogether are expected

to increase Government revenue by shillings

119,456.6 million.

46

D.The Local Government Finance Act, CAP 290.

  1. Honourable Speaker, I propose to make

amendments in the Local Government Finance Act,

CAP 290 as follows:-

(i) To introduce Section 37A in order to give

powers to the Minister responsible for local

Government to direct the Local Authorities to set

aside 10 percent of all monies collected from

their own source of revenue for the purpose of

funding registered Women and Youths groups

within their jurisdiction. Out of these funds, 50

percent will be allocated for women groups, and

50 percent for youth groups; and these will be

provided as interest free loans. The Minister will

make regulations to ensure proper running of

the funds set aside for these groups; and

(ii) To amend section 16(6) of the Local Government

Finance Act, CAP 290 which provides exemption

on Produce Cess for the companies and

institutions which pays Service Levy. Basically,

the exemption should apply only to Companies

and Institutions which produce agricultural

crops and process them for value addition.

Therefore, I propose to introduce section 16(7) to

require any Corporate entity which produces

agricultural crops without processing them for

47

the purpose of adding value to pay Produce

Cess.

  1. The Tax Administration Act, CAP 438
  2. Honourable Speaker, I propose to make amendment

in the Tax Administration Act, CAP 438 in order to

introduce Tax Amnesty. The proposed 100 percent

amnesty on interest and penalties will exist for six

months starting from 1st July 2018 up to 31st

December 2018. This measure is expected to

improve tax compliance by 10 percent and hence

enable the Government to collect the outstanding

principal amount.

The amendment in the Tax Administration Act is

expected to increase Government revenue by

shillings 500,000 million.

  1. The Local Government Finance Act, CAP 290,

The Public Finance Act, CAP 348; and The Bank

of Tanzania Act, CAP 197.

  1. Honourable Speaker, I propose to make

amendments in the Local Government Finance Act,

CAP 290, The Public Finance Act, CAP 348; and The

Bank of Tanzania Act, CAP 197 in order to

introduce a Treasury Single Account which will be

used for collection and payment of Government

funds. The account is being established following

48

the agreement reached by the East African

Community Partner States aimed at ensuring

effective control and management of Government

resources. This measure will reduce the number of

Government Accounts operated in the Commercial

Banks and Central Bank; reduce costs related to

services offered by Commercial Banks to the

Government and improve the financial position of

the Paymaster General Account (Government Net

Deficit Position).

G.The East African Community Customs

Management Act, 2004

  1. Honourable Speaker, the meeting of Ministers

responsible for Finance (Pre-Budget Consultation of

the Ministers of Finance) which was held on

4

thMay, 2018 in Arusha, Tanzania, agreed to effect

changes in the Common External Tarriff (CET) and

make amendments to the East Africa Community

Customs Management Act (EAC-CMA), 2004. The

main focus of these amendments was on

industrialization for job creation and shared

prosperity.

  1. Honourable Speaker, the changes in the Common

External Tariff (CET) which were recommended

and agreed are as follows:-

(i) Continue to grant duty remission and apply an

49

import duty of 10 percent instead of 35 percent

on wheat grain falling under HS Code 1001.99.10

and 1001.99.90 for one year. The measure takes

into account that there is no adequate capacity in

the EAC region to produce wheat and satisfy the

demand;

(ii) Continue to grant stay of application of EACCET

on Electronic Fiscal Devices (EFD’s) used to

collect Government revenues (HS Code

8470.50.00) and apply duty rate of 0 percent

instead of 10 percent for one year. The objective

of this measure is to continue encouraging the

taxpayers to use EFD Machines for accounting of

VAT and efficient management control in areas

of sales analysis and stock control;

(iii) Grant duty remission on papers used to

manufacture exercise books and text books and

apply a duty rate of 15 percent instead of 25

percent. This involves papers falling under Hs

Codes 4804.11.00; 4804.21.00; 4804.31.00; and

4804.41.00;. The measure will apply only to the

manufacturers of exercise books and text books

and it is the Government expectation that

producers and suppliers of these books will

make them available at affordable prices

particularly to school children;

50

(iv) Grant duty remission on papers used as raw

materials for the manufacturing of Gypsum

Board and apply a duty rate of 0 percent instead

of 10 percent for one year. The paper falls under

HS Code 4805.92.00. This measure is intended to

promote local manufacturing of Gypsum

Boards, employment and increase Government

revenues;

(v) To impose import duty of 35 percent on sugar

(consumption sugar) this is imported under

specific arrangements to cover the shortage in

the domestic market. Currently an import duty

of 25 percent is imposed on sugar;

(vi) Continue to grant stay of application of EACCET

rate on Gypsum Powder falling under HS

Code 2520.20.00 and apply a duty rate of 10

percent instead of 0 percent for one year. This

measure is intended to protect local producers

and promote production of Gypsum Powder by

using locally available raw materials;

(vii)Grant duty remission and apply a duty rate of 10

percent instead of 25 percent on Self Adhesive

Label (HS Code 4821.10.90) for one year. The aim

of this measure is to promote competitiveness of

domestic industries by lowering their

production costs and create employment;

51

(viii) Grant duty remission and apply a duty rate of

0 percent instead of 25 percent on Printed

Aluminium Barrier Laminates (ABL) HS Code

3920.10.90 for one year. The objective of this

measure is to reduce production costs and

promote competiveness of domestic industries

producing toothpaste. It is also intended to

promote employment;

(ix) Grant stay of application of the EAC-CET rate of

0 percent and apply a duty rate of 25 percent on

Crude Palm Oil (HS Code 1511.10.00) for one

year. This measure is intended to promote local

production of oil seeds and edible oil taking into

account the available opportunities to increase

its production. Furthermore, it is expected to

increase employment both in the agricultural

and industrial sector;

(x) Grant stay of application of EAC-CET rate of 0

percent or 10 percent and apply a duty rate of 25

percent on crude edible oils (for example

sunflower oil, palm oil, groundnuts oil, olive oil,

maize corn oil etc.) for one year. The objective of

this measure is to promote the production of

edible oils by using locally produced seeds. It is

also intended to protect domestic producers and

create both employment and income to the

farmers;

52

(xi) Grant stay of application of EAC-CET rate of 25

percent and apply a duty rate of 35 percent for

one year on Semi-refined and refined/double

refined edible oil (for example sunflower oil,

palm oil, groundnuts oil, olive oil, maize corn oil

etc.). This measure is intended to promote the

processing of edible oils in the country using

locally grown seeds and save foreign exchange

used in the importation of edible oil;

(xii)Grant stay of application of EAC-CET and

instead apply a duty rate of 25 percent or USD

350 per metric ton whichever is higher for one

year on nails, tacks, drawing pins, corrugated

nails staples (HS Code 7317.00.00) other than

those of heading 83.05 and similar articles of iron

or steel, whether or not with heads of other

materials. The objective of this measure is to

protect local producers of these products against

imported cheap products;

(xiii) Grant stay of application on EAC-CET and

apply a duty rate of 25 percent or USD 1.35 per

kilogram of safety matches whichever is higher

for one year (HS Code 3605.00.00). The measure

is aimed at protecting the local industries in the

region;

(xiv) To reduce the duty rate of PolyVinyl Acohol

(HS Code 3905.30.00) from 10 percent to 0

53

percent in the EAC-CET. The product is a raw

material for manufacturing of paints;

(xv)To grant duty remission at 0 percent on inputs

used to manufacture pesticides, fungicides,

insecticides, and caricides as approved by the

relevant authorities. The measure will promote

investment in the local production of these

important inputs which are required for

improvement of agricultural production;

(xvi) Grant duty remission and apply a duty rate of

0 percent instead of 10 percent for one year on

RBD Palm stearin (HS Code 1511.90.40). This

measure is intended to ensure availability of

RBD for stand alone soap industries. It also takes

into account the Government decision to impose

an import duty of 25 percent on crude palm oil;

(xvii)Grant stay of application of EAC-CET on

potatoes and apply a duty rate of 35 percent

instead of 25 percent for one year (HS Code

0701.90.00). This measure is intended to protect

Local production of potatoes;

(xviii) Grant stay of application of EAC-CET on

chewing gum (HS Code 1704.10.0) and apply a

duty rate of 35 percent instead of 25 percent for

one year. The objective of this measure is to

protect local production of the products because

54

there is sufficient capacity to produce in the

region;

(xix) Grant stay of application of EAC-CET on other

sugar confectionary (sweets), (HS Code

1704.90.00) and apply a duty rate of 35 percent

instead of 25 percent for one year. The measure

is intended to protect local producers of the

product;

(xx)Grant stay of application of EAC-CET on

chocolates (HS Code 18.06) and apply a duty

rate of 35 percent instead of 25 percent for one

year. The measure is taken because there is

sufficient capacity to manufacture the product in

the region;

(xxi) Grant stay of application of EAC-CET on

Biscuits (HS Code 19.05) and apply a duty rate of

35 percent instead of 25 percent for one year.

This measure is also aimed at protecting local

producers of the product since there is adequate

capacity to produce in the region;

(xxii)Grant stay of application of EAC-CET on

tomatoe sauce (HS Code 2103.20.00) and apply a

duty rate of 35 percent instead of 25 percent for

one year. The measure is intended to protect

local producers of the product as there is

sufficient capacity to produce in the region;

55

(xxiii) Grant stay of application of EAC-CET on

mineral water (HS Code 2201.10.00) and apply a

duty rate of 60 percent instead of 25 percent for

one year. There is sufficient capacity to produce

this type of water in the country and therefore

there is a need to protect the local industries;

(xxiv) Grant stay of application of EAC-CET on meat

and edible offal under chapter 12 and apply a

duty rate of 35 percent instead of 25 percent for

one year. This measure is intended to promote

local processing and value addition on meat. It is

also expected that the measure will create

employment opportunities in the Livestock and

industrial sector; and

(xxv) Grant stay of application of EAC-CET on

Sausages and similar products (HS Code

1601.00.00) and apply a duty rate of 35 percent

instead of 25 percent for one year. This measure

is also intended to protect domestic industries

which produce similar products in the region.

  1. Honourable Speaker, The Ministers responsible for

Finance also agreed to make amendments in the

EAC Customs Management Act, 2004 as follows:-

(i) To amend the Fifth Schedule Part A item 9

which provides import duty exemption on rally

cars and include motorcycles for rally for them

56

to also be granted exemption. This measure is

intended to promote motorcycles sports and

tourism in the region;

(ii) To amend the EAC-CMA, 2004 and split Hs

Code 8903.99.00 to provide for Common

External Tariff of 0 percent for Motor Boat

Ambulance under HS Code 8903.99.10. This

measure is intended to reduce costs related to

services provided by Motor Boat Ambulance;

and

(iii) To amend the Fifth schedule of the EAC –CMA

in order to provide import duty exemption on

various types of motor vehicles for

transportation of tourists. These include Motor

Cars, Sight Seeing buses and overland trucks

which are imported by licensed tour operators

and must meet specific conditions. The objective

of this measure is to promote investments in the

tourism sector, improve services, create

employment and increase Government revenue.

  1. Honourable Speaker, The Minister for Finance had

also agreed to provide duty remission on a selected

list of raw materials and industrial inputs for the

manufacturer of textiles and foot wear. This measure

is aimed at accelerating the industrialisation process

in the textile and leather sector and creating

employment opportunities. The EAC Partner States

57

have already submitted to the Secretariat a list of

raw materials and industrial inputs to facilitate

gazetting and implementation during the year

2018/19.

The Import Duty measures altogether are expected

to reduce Government revenue by shillings 1,630.2

million

  1. The Laws Governing the Operation of Crop

Boards

56.Honourable Speaker, I propose to make amendments

to the Laws governing the operation of Crop Boards

in order to require them to deposit in the Paymaster

General Account all fees and levies imposed on the

sales of crops. The objective of this measure is to

ensure that the revenue collected is properly

accounted, effectively managed and utilised for the

intended purpose. The Crop Boards operations and

costs related to crop development will be financed

from the Paymaster’s General account.

  1. The Gaming Act, CAP 41.
  2. Honourable Speaker, I propose to change the

Gaming tax rate from 6 percent on gross sales to 10

percent on gross sales in sports betting operations.

58.Honourable Speaker, I propose to increase Gaming

tax from shillings 32,000 to shillings 100,000 per

machine/month on slot machines. The measure is

58

intended to increase Government revenue and

promote fairness within the gaming industry.

  1. Honourable Speaker, I propose to increase gaming

tax from 15 percent to 18 percent on Gross Gaming

Revenue for Land based Casino operators. The

measure is intended to increase Government

revenue taking into account that the current rate of

15 percent was introduced in the year 2012.

60.Honourable Speaker, I propose to increase gaming

tax from 15 percent to 20 percent on Gross Gaming

Revenue for Forty Machines.

All these measures on Gaming activities are

expected to increase Government revenue by

shillings 21,198.8 millions

  1. Minor Amendments in Tax Laws and Others.

61.Honourable Speaker, I propose to make minor

amendments to various Tax Laws and other Laws in

order to ensure their smooth and effective

implementation. The amendments will be effected

through the Finance Bill 2018 and Government

Notices

59

  1. Amendments of Various Fees and Levies

imposed by Ministries, Regions and

Independent Departments.

62.Honourable Speaker, I propose to amend rates of

fees and levies charged by Ministries, Regions and

Independent Departments in order to rationalize

with the current level of economic growth. The

amendments will be reflected in the Finance Act,

2018 and others through Government Notices. The

proposed amendment includes the following:-

(i) To exempt Government Agencies/Institutions

from paying Land rent. These Institutions are

providing services and not making profits on

their services;

(ii) To abolish and reduce some levies and fees

imposed on salt sub-sector. This measure has

taken into account the fact that there are so

many levies and fees imposed on salt which

leads to high production costs and discourages

investors in this sub-sector. I therefore propose

to effect changes in the levies and fees imposed

on the production of Salt as follows:-

  1. a) To abolish Produce Cess imposed on Salt

producers by the Local Governments;

  1. b) To abolish Inspection and Clearance fees of

one percent (1%) of gross value of minerals

60

imposed in the Salt industry;

  1. c) Abolish Mangrove Levy (shillings 100 per

hectre per annum) charged on Salt

producers;

  1. d) Abolish fee for reviewing Salt project

concept paper charged by the National

Environmental Management Council

(NEMC);

  1. e) Abolish fee imposed on Solar Salt panel;
  2. f) Abolish supervision fee on Salt mining

centres charged by Tanzania Forest Services

Agency;

  1. g) Abolish Registration fee for Salt mining

centre;

  1. h) Abolish Environmental Impact Assesment

fee imposed on Salt producers by NEMC;

  1. i) Reduce OSHA Levy from shillings 2,000,000

to shillings 1,000,000 imposed on Salt

producers; and

  1. j) Reduce application fee for export permit of

minerals from USD 100 to shillings 20,000

per annum imposed on Salt producers.

(iii) I propose to effect changes in the Fees and

Levies charged by OSHA as follows:-

  1. a) Abolish fees imposed on application form

for registration of working places;

  1. b) Abolish levy imposed on the registration of

61

working places;

  1. c) Abolish fines related to fire and rescue

equipments;

  1. d) Abolish OSHA compliance license of

shillings 500,000; and

  1. e) Abolish consultancy fee of shillings 450,000;

63.Honourable Speaker, the Government will continue

to review various Levies and Fees imposed by

Parastatal Organisations; Institutions and Agencies

with a view to improving business and investment

environment.

  1. Effective Date for Implementation of New

Revenue Measures

64.Honourable Speaker, unless otherwise stated, the

new measures shall become effective on 1st of July,

2018.

62

  1. BUDGET STRUCTURE FOR THE YEAR 2018/19
  2. Honourable Speaker, consistent with

macroeconomic and fiscal policy objectives, the

budget frame for 2018/19 shows that shillings 32.48

trillion will be mobilized and executed in the

period. The Government plans to collect domestic

revenue including LGAs own sources amounting to

shillings 20.89 trillion, equivalent to 64.3 percent of

the total budget. Out of this amount, tax revenue is

estimated at shillings 18.0 trillion, equivalent to 13.6

percent of GDP. In addition, non-tax revenue is

estimated at shillings 2.16 trillion and revenue from

LGAs own sources estimated is shillings 735.6

billion.

  1. Honourable Speaker, Development Partners are

expected to contribute shillings 2.68 trillion which is

8.2 percent of the total budget. These grants and

concessional loans includes shillings 2.0 trillion as

grants and concessional loans for projects; shillings

125.9 billion is Sector Basket Funds and shillings

545.8 billion is General Budget Support (GBS).

  1. Honourable Speaker, the Government plans to

borrow shillings 8.90 trillion non concessional loans

from domestic and external sources. Domestic

borrowing is expected to be shillings 5.79 trillion,

whereas shillings 4.60 trillion is for financing

rolling over of maturing Treasury bills and bonds

63

and shillings 1.19 trillion are new loans for

financing development projects. In order to speed

up on implantation of projects infrastructure, the

Government expects to borrow shillings 3.11 trillion

from external source.

  1. Honourable Speaker, in 2018/19, the Government

plans to spend shillings 32.48 trillion. Out of this

amount, shillings 20.47 trillion is set aside for

recurrent expenditure including shillings 7.41

trillion for wages and salaries and shillings 10.00

trillion for servicing Government debt, Government

contributions to Pension Funds and other services.

In addition, development expenditure is estimated

at shillings 12.01 trillion, equivalent to 37 percent of

the total budget whereas shillings 9.88 trillion is

locally financed and shillings 2.13 trillion is foreign

financed. Funds allocated to development

expenditure is consistency with Five year

Development Plan (2016/17 – 2020/21) of allocating

development expenditure in the range of 30 to 40

percent of the total budget.

  1. Honourable Speaker, consistent with the budget

frame as I have explained above, the budget

structure for 2018/19 is as shown in Table A.

64

Table A: Budget Frame for 2018/19

Revenue 2018/19

  1. Government Domestic Revenue 20,158,989

(i) Tax Revenue (TRA) 18,000,219

(ii) Non Tax Revenue 2,158,770

  1. LGAs own source 735,589
  2. External Grants and Concessional Loans 2,676,645

(i) General Budget Support 545,765

(ii)Projects Loans and Grants 2,005,016

(iii) Basket Loans and Grants 125,864

  1. Domestic & External Non Concessional Loans 8,904,727

(i) External Non Concessional Borrowing 3,111,058

(ii) Domestic Non Concessional Borrowing (0.9% of GDP) 1,193,669

(iii) Domestic Non Concessional Borrowing (Rollover) 4,600,000

TOTAL REVENUE (A+B+C+D) 32,475,950

Expenditure

  1. Recurrent Expenditure 20,468,676

o/w (i) National Debt Service 10,004,480

-Domestic Interest 1,413,631

-Domestic Amortization (Rollover) 4,600,000

– External Amortization 1,669,653

– External Interest 689,667

– Government Contribution to Pension Funds 1,195,866

-Other Expenditure under CFS 435,663

(ii) Wages and Salaries 7,409,952

(iii) Other Charges 3,054,244

– Protected Expenditure 1,891,695

– LGAs Expenditure (Own Source) 389,862

– MDAs Operational Costs 772,687

  1. Development Expenditure 12,007,273

(i) Domestic Financing 9,876,393

o/w LGAs Expenditure (Own Source) 345,727

(ii) Foreign Financing 2,130,880

TOTAL EXPENDITURE (E+F) 32,475,950

BUDGET DEFICIT AS PERCENTAGE OF GDP 3.2%

Millions Shillings

Source: Ministry of Finance and Planning

65

  1. CONCLUSION
  2. Honourable Speaker, as I explained earlier, the

theme of the 2018/19 Budget is “to build an

industrial economy that will stimulate

employment and sustainable social welfare”. The

industrial economic reforms will be built through

inclusive economic participation, partnership and

collective efforts. In order to achieve the intended

goals, bold decisions must be undertaken in

allocating the available scarce resources to strategic

areas. Since it is very difficult to accept changes

and changes are quite often opposed, I urge the

Honourable Members of Parliament and citizens at

large to combine efforts and talents of our people

and our businesses in order to achieve our

aspirations goals. In light of this, we need

patriotism and high level of integrity, while aiming

at eradicating poverty, job creation and inclusive

economic growth.

  1. Honourable Speaker, the Government will

continue to pursue appropriate measures to

increase production in manufacturing and

agriculture sectors, increase domestic revenues in

order to enhance spending in development projects

and recurrent expenditure, thus reducing

dependency; the measures include: attract

investment, allocate financial resources to few

66

productive areas, to enhance compliance of tax

laws; to formalize informal sector including

registration of land and property owners in the

taxpayers identification system and the use of

electronic systems in various transactions including

the use of EFD and electronic bank cards in service

areas such as supermarkets, shopping malls, hotels

and petrol stations. I therefore, urge my fellow

Tanzanians to be committed in paying taxes and

ensure that we issue or demand receipts on any

transaction made. Moreover, the Government

would like to thank all citizens who have shown

patriotism in paying taxes voluntarily.

  1. Honourable Speaker, the Government priority is to

foster industrial based economy – utilizing locally

available raw materials, notably from agriculture,

livestock and fisheries, in order to enhance

employment opportunities, to improve availability

and accessibility of quality social services (water,

health, and education) and to reduce poverty.

Moreover, the Government will continue to combat

corruption, to improve security and management of

natural resources and to control public

expenditures. Further, the Government will

continue to improve the business environment and

investment by implementing the Blueprint for

Regulatory Reform to Improve Business Environment

67

for Tanzania. The programme intends, among

others, to harmonize and simplify the procedures

for payment of taxes, fees and levies.

  1. Honourable Speaker, the Fifth Phase Government

intends to promote culture and discipline of

adopting realistic revenue projections which form

the basis for determining expenditure ceilings

instead of the normal practice of starting with

planning and listing requirements. For this

purpose, the Government will focus on

implementation of few strategic projects in such a

way that it will involve all sectors and ensure that

the projects are completed prior to commencement

of new projects.

  1. Honourable Speaker, I am a passionate reader of

biographies of renowned leaders who have

succeeded to make social, political and economic

changes in their respective countries like Deng

Xiaoping-Peoples Republic of China; Dr. Mahathir

Mohamed-Malaysia; Lee Kuan Yew- Singapore;

Park Chung Hee-Korea; Nelson Mandela-South

Africa; Father of our Nation, Mwalimu Julius

Kambarage Nyerere-Tanzania; Quett MasireBotswana

etc. What I have learned is that such

leaders have the following qualities:

68

(i) They have a clear vision for their countries’

development;

(ii) They do not hesitate to implement their visions

courageously and without wavering;

(iii) They are courageous, resilient, daring in

implementing what they believe in;

(iv) They are gifted and sympathetic to the suffering

of the poor;

(v) They are people of integrity, hate corruption and

graft, and they are disciplined;

(vi) They lead by examples; and

(vii)They have endurance and perseverance in a bid

to bring about positive changes in their

countries.

75.Honourable Speaker, I would like to reiterate to my

fellow Tanzanians that, the Almighty God has

granted us a State Leader, His Excellency Dr. John

Pombe Joseph Magufuli with all attributes outlined

above. I have earlier explained few things that His

Excellency has bravely executed within a short

period of time to affirm the attributes. My plea to

fellow Tanzanians is that we utilize this rare

opportunity by working hard as a better way of

supporting the efforts of His Excellency and

endeavour to build a new industrialized Tanzania.

This is an important issue as prophesized by the

Father of the Nation, Mwalimu Julius Nyerere that,

69

in a development journey towards building

industrial economy, our leader will encounter

obstacles and ridicule noises from bad wishers in

order to discourage us from attaining the intended

aspirations. Therefore, all Tanzanians are obliged to

encourage our President not to retreat from the

journey His Excellency initiated aimed at attaining

Tanzania industrialized economy. Please allow me

to complete my plea by quoting the words from the

speech of Father of the nation when he was speaking

to TANU study Group on 13 June, 1967. He said

‘‘Maendeleo na kazi ni kitu kile kile, hakuna namna

nyingine ya sisi kuendelea, hatukupewa namna nyingine

ya sisi ya kuendelea ….. Huwezi kutenganisha vitu viwili

hivi, kuendelea na kazi, kwani kazi ndiyo shughuli ya

……kuondoa matatizo yanayomzuia binadamu hali yake

kukamilika.…..hakuna njia nyingine lazima kufanya

kazi….. na kila unavyozidi kufanya kazi kwa akili zaidi

ndivyo mnavyozidi kwenda, ndivyo mnavyozidi

kuendelea, …… kazi ndio utu … kazi ndio maendeleo

….kazi ndio maisha, ni uhai, kazi ndio civilization, ndio

uungwana, ndio kula vizuri, ndio kuvaa vizuri, ndio

kuishi katika nyumba nzuri, ….ndio kushinda matatizo

yote tuliyonayo duniani – namna ya kuyashinda ni

kazi….’’1

 

1

Insha Tatu za Kifalsafa, Julius Nyerere, Kivazi Occasional Papers, No. 3, 2016

70

The message we are getting from the above

quotation is that: Development and work are

inseparable. There is no any other means for us to develop;

we have not been given another alternative for us to

develop. One cannot detach the two, development and

work. To develop we need to work hard; work is a living;

and work is dignity. Work brings civilization… through

work we overcome all the hurdles of life.

  1. Honourable Speaker, as I conclude my speech, I

would like to thank our Development Partners (DPs)

for their continued support in the implementation of

development programmes and projects. Some of

them are here with us today. Development Partners

are expected to contribute shillings 2,676.6 billion to

support the Government budget for 2018/19 as

follows: The World Bank (shillings 863.13 billion);

African Development Bank (shillings 358.63 billion);

The Global Fund ( shillings 313.90 billion); Sweden (

shillings 179.80 billion); European Union (shillings

158.40); India shillings (104.57 billion); Germany

(KfW & GIZ) (shillings 81.31 billion); JICA/Japan

(shillings 76.96 billion); United Kingdom through

DFID (shillings 71.21 billion); Denmark (shillings

69.57 billion); AFD/France ( shillings 61.06 billion);

Canada ( shillings 48.84 billion); Arab Bank for

Economic Development in Africa BADEA (shillings

40.01 billion); South Korea/EDCH (shillings 39.05

71

billion); UNICEF (shillings 36.53 billion); Finland

(shillings 28.08 billion); IFAD (shillings 26.82 billion);

Italy (shillings 22.05 billion); Norway (shillings 20.04

billion); European Investment Bank (shillings 17.88

billion); Switzerland (shillings 15.74 billion); UNDP

(shillings 12.34 billion); Belgium (shillings 11.08

billion); Saudi Arabia/Saudi Fund (shillings 4.81

billion); USAID (shillings 4.20 billion); OPEC/OFID

(shillings 2.75 billion); and UNFPA (shilling 2.56

billion). It is our expectations that, the funds pledged

by our Development Partners will be timely

disbursed as stated. As the Government, we assure

that the funds will be spent appropriately.

  1. Honourable Speaker, I submit that, this budget I

have presented would not have been possible

without valuable contributions from Hon. Ministers,

Deputy Ministers, Permanent Secretaries, Deputy

Permanent Secretaries, Cabinet Secretariat, other

Government technocrats and Government

institutions. I would like to extend my sincere thanks

to every one of you for the contribution you have

provided in the entire process of budget

preparations.

  1. Honourable Speaker, I would like to thank my fellow

colleagues at the Ministry of Finance and Planning

starting with Honourable Dr. Ashatu K. Kijaji,

72

Member of the Parliament for Kondoa Constituency

and Deputy Minister for Finance and Planning, and

Mr. Doto M. James, the Permanent Secretary to the

Treasury and Paymaster General, and Deputy

Permanent Secretaries: Ms. Amina Kh. Shaaban, Dr.

Khatibu M. Kazungu, and Ms. Susana B. Mkapa. All

of them together, have given me unwavering

support and cooperation in undertaking the

Ministry’s duties and have coordinated well the

preparation of this budget. I also congratulate

Professor Florens Dominick Makinyika Luoga for

being appointed as a Governor of the Bank of

Tanzania, and immediately assuming great

responsibilities of supervising the financial sector.

Through him, I also cherish the support by his three

Deputy Governors, Directors, and all staff of the

Bank of Tanzania. Likewise, I recognize a

commendable job of revenue collection under the

leadership of TRA Commissioner General, Mr.

Charles E. Kichere, the Controller and Auditor

General, Prof. Mussa Assad, and Director General of

the National Bureau of Statistics, Dr. Albina Chuwa.

Moreover, I would like to congratulate Mr.

Athumani Selemani Mbuttuka, who has recently

been appointed to the position of Treasury Registrar.

  1. Honourable Speaker, I would also like to

acknowledge the support from the heads of

73

institutions under the Ministry of Finance and

Planning including: Banks (TADB, TIB-DFI, TIBCBL,

TPB Bank); National Social Funds (PSPF,GEPF,

PPF); Tax Appeals Boards (TRAB, TRAT); Insurance

Services (TIRA, NIC); Capital Securities (CMSA,

TCEM, DSE); Investment Securities (UTT-MFI, UTTAMIS,

UTT-PID); Tanzania Lottery Board; Training

Institutions (IFM, IRDP, IAA, TIA, EASTC); and

Fund for Small Financial Services (SELF

Microfinance Fund). I also extend my thanks to the

Heads of Departments and Units, without forgetting

technocrats, Personal Secretaries, Registry Workers,

Drivers, Office Attendants and Security Guards of

our Ministry and its institutions for the great job well

done in FY 2017/18 in accomplishing this budget.

  1. Honourable Speaker, I cannot conclude my remarks

without mentioning my beloved wife Mbonimpaye.

Her heart of devotion to the Almighty God, faith and

love enabled me to discharge my duties and

responsibilities. I thank her so much together with

all our children and grandchildren and the family at

large. Further, I would like to express my gratitude

to all Tanzanians (farmers, workers, business

community). I thank them very much for their

patriotism in working hard and paying taxes in

accordance with the law for our nation’s

development. Furthermore, I would like to thank

74

all pupils from nursery to primary schools and

students in secondary and tertiary education who

study hard and we hope, out of them, we will get

good leaders and qualified labour force. In addition,

I would also like to thank our elders who made a

great contribution to our Nation during their

productive age. Also, I cannot afford to forget the

people of Buhigwe and Kasulu Districts in Kigoma

region in general. I am proud of you because you

raised me up. I love you all! In addition, I would like

to thank my fellow Nzinje residents in Dodoma

(formerly known as Zuzu) for their warm welcome

to me and my family.

  1. Honourable Speaker, since it is expected that today

is the last day of the holy month of Ramadan, I

would like to wish all Muslims Eid Mubarak.

  1. Honourable Speaker, let me wind up my speech by

thanking The Almighty God for His blessings which

enabled me to accomplish the presentation of this

speech and to you Honourable Members of

Parliament and all Tanzanians – I thank you very

much!