The Chanzo Morning Briefing – June 15, 2022. 

In our briefing today: Tanzania introduces digital tax, reduced mobile money levy by 43pc; Authorities in Zanzibar investigate alleged abduction, torture of Mwinyi’s critic; ACHPR ‘gravely concerned’ about the fate of indigenous people in Ngorongoro; Oman Airports to develop Kilimanjaro airport; Wentworth Resources to acquire 25pc working interest in Tanzanian gas development project.
The Chanzo Reporter15 June 20226 min

Dar es Salaam. Good morning! The Chanzo is here with a rundown of major news stories reported in Tanzania on Tuesday, June 14, 2022.

Tanzania introduces digital services tax, reduced mobile money levy by 43pc

Tanzania has introduced a digital services tax on non-resident service providers that operate in Tanzania. The new tax proposals were tabled yesterday, June 14, 2022, by Minister of Finance and Planning Dr Mwigulu Nchemba in the readout of the national budget for the financial year 2022/2023.

“The ministry proposes a two percent tax rate of the transactions volume made to non-resident digital service providers,” Mr Mwigulu told lawmakers in the capital Dodoma. “This is to expand the tax base in the principle of fairness and equity of the tax system.”

The proposal comes a year and three months since the government hinted at introducing Digital Service Tax to big tech operating in Tanzania. In East Africa, Tanzania joins the like of Kenya which had introduced the tax in 2020, which is about 1.5 per cent of the gross transaction volume.

While Tanzania has been eyeing the digital environment as the new tax source, the latest mobile money transaction levy was received with a lot of criticism from the public.

Users even withdrew from the usage of mobile money services this has made the government reduce the levy for the second time by 43 per cent in the 2022/2023 budget readout. The proposed limit is now Shs. 4,000 from  Shs.7,000, however, government has proposed expanding the levies to all electronic transactions.

With the increasing tax burden on the crucial mobile money service, stakeholders were pushing for the government to look elsewhere for funding sources, especially from global companies that collect revenues in the country.

It’s yet to be clear how the digital service tax will operate, it’s expected, however, that this will be revealed in the coming weeks with the release of the Finance Act.

Authorities in Zanzibar investigate alleged abduction, torture of Mwinyi’s critic

Authorities in Zanzibar are investigating a case involving the alleged abduction and torture of a veteran Chama cha Mapinduzi (CCM) cadre Baraka Mohamed Shamte who was attacked on June 12, 2022, a few days after criticising President Hussein Mwinyi’s policy of leasing a number of islets to investors.

Director of presidential communications in Zanzibar Charles Hillary said in a statement on Monday that the government is committing itself to investigate the alleged attack on the veteran politician “and bring the perpetrators to justice.”

Mjini Magharibi regional police commander Abdallah Hussein Mussa told a press conference on Monday that on June 12, 2022, police received information from the Mnazi Mmoja Hospital regarding the physical attack on Mr Shamte by unknown assailants in the victim’s hometown of Unguja Ukuu, Kusini Unguja.

According to police reports, Mr Shamte, 83, received treatment at the Mnazi Mmoja Hospital and was released on June 13, 2022, after his health appeared to have improved.

Before he was attacked by what eyewitnesses described as “masked people” – popularly referred to as “zombies” or “janjaweed” – Mr Shamte was out on bail after police charged him with sedition after making a statement that police thought was demeaning to the government officials.

Full report here.

ACHPR ‘gravely concerned’ about the fate of indigenous people in Ngorongoro

The African Commission on Human and Peoples’ Rights said Monday that it is “gravely concerned” that the forcibly uprooting of the affected communities in Ngorongoro entails grave danger to various rights of the members of the communities, including their rights to life, property, culture, family, existence and natural resources.

In a statement, commissioner Solomon Ayele Dersso said that the commission has been receiving reports of police “using force to uproot the Maasai from their ancestral land in the Loliondo division of the Ngorongoro district,” injuring at least 31 people; “an act which is strongly condemned by the commission.”

“The commission wishes to recall that it sent a letter of urgent appeal in February 2022 to President Samia Suluhu Hassan, which drew her attention, among others, to the human rights requirements that evictions are only carried out as a last resort after all alternatives to eviction have been explored, and that all evictions comply with international and regional standards,” Mr Dersso said in the statement.

Mr Dersso cautioned that not only should the members of the affected community be fully consulted, but also their consent should be sought and obtained.

Among other things, the African Commission on Human and Peoples’ Rights wants Tanzania to “halt the ongoing forcible eviction of the affected Maasai community in the Loliondo division of Ngorongoro district,” the statement noted.

The commission also wants the government to “urgently open independent investigations into the violence occasioned since the start of the ongoing forcible eviction of the affected communities and ensure full and effective reparations to address the harm suffered by victims, on any loss of property.”

Tanzania should also ensure that any measures for the implementation of the conservation area are carried out in full collaboration with and participation of the affected communities, the commission pointed out.

This includes guarantees for secure access to and use of resources on the affected territory by the members of the community, the commission added.

Oman Airports to develop Kilimanjaro airport

Oman Airports signed a memorandum of understanding (MoU) with Kilimanjaro Airports Development Company (KADCO) on Monday to develop a VIP passenger terminal in Kilimanjaro International Airport, according to reports by the Omani press.

The MoU that was signed by Abdul Nasser Abdullah al Yamani, Vice-President of Business Development of Oman Airports and Christine Mwakatobe of KADCO is expected to Tanzania benefit from Oman Airports’ experience in airport management and VIP services.

The deal is one among many others that the three-day visit to Oman by President Samia Suluhu Hassan produced.

Based on the agreement, Oman Airports will undertake the development of the General Terminal for VIPs and hangar facility at Kilimanjaro International Airport, the development of a five-star hotel for passengers and a business complex/shopping mall in the airport.

The MoU has scope for the development of other facilities that may be agreed upon mutually between the parties.

“This partnership will serve in developing the facilities referred to in the text of the MoU to ensure the provision of high-standard services as part of efforts to raise revenues for both the Tanzanian government that owns the airport and Oman Airports,” a source was quoted by Muscut Daily as saying.

Wentworth Resources to acquire 25pc working interest in Tanzanian gas development project

Wentworth Resources, an independent, Tanzania-focused natural gas production company, announced this week that it has reached an agreement with Scirocco Energy plc to acquire its 25 per cent non-operated working interest in the Ruvuma Production Sharing Agreement.

The 1.9 Tscf (mean GIIP) Ntorya gas discovery located within Ruvuma, Tanzania is operated by ARA Petroleum Tanzania (50 per cent working interest, Aminex plc 25 per cent) and is adjacent to Wentworth’s Mnazi Bay gas producing asset.

The consideration is comprised of an initial cash payment of $3 million due upon completion, with further deferred and contingent cash payments of up to $13 million dependent on certain development and production milestones.

The consideration will be funded through Wentworth’s cash resources whilst allowing the company to maintain its commitment to a long-term, sustainable and progressive dividend for shareholders.

“This is a transformational transaction for Wentworth establishing us as a dual-asset, full-cycle E&P with a significantly enhanced resource base and production profile,” Katherine Roe, chief executive of Wentworth, said in a statement. “The deal represents an attractively priced, low-risk entry into a high-growth opportunity which cements our position as a leading supplier of domestic gas to Tanzania.”

Roe added: “This compelling growth opportunity is fully aligned with our commitment to support the Government to reach its goal of providing universal energy access by 2030 in accordance with our purpose to empower people with energy and deliver value for Tanzania, Wentworth and all our stakeholders.”

This is it for today and we hope you enjoyed our briefing. Please consider subscribing to our newsletter (see below) or following us on Twitter (here) as that is the best way to make sure you do not miss any of these briefings.  And in case you have any questions or comments, please consider dropping a word to our editors at editor@thechanzo.com.

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