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The purpose of this study has been to find out the impact of tax exemption and tax
relief for foreign investors towards government revenue, having intent to look for
better solutions to raising government revenue. The study relied heavily on the
practitioners and documents to collect necessary information regarding tax relief and
exemption from the stakeholders, TRA being the major target area of study. It
looked at positive and negative sides of the issues.
The study employed a case approach where TRA was the major area of study. It
involved such department as Customs and Excise, Finance and
Administration/Management. Both primary and secondary data were collected. The
results were presented using frequency distribution tables and graphs using such
programs as excel and the sort.
The results from the analysis revealed that the prevalent tax exemption and tax relief
situation does not on its own attract foreign investments into Tanzania. Moreover,
exemption and relief on tax does not contribute to the improved revenue collection,
rather, they deter and get the country into unnecessary losses of revenue and
resources as disadvantages have outweighed the advantages of the said exemption
and relief. However, if well implemented, tax relief and exemption may be a drive
for investment and may lead to increased revenue.
It was concluded that there are yet lessons to be learned out of the study current tax
policies on exemption and relief, that they do not work for the benefit of the citizens
of Tanzania, as they are not based on a win-win situation, rather they favour
foreigners leaving the country dependent of aids.
It has been recommended that tax administrators and managers put their hands
together to review the current tax regime, especially on exemption and relief so that
revenue collection is enhanced |
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