VAT on online data services in offing

DODOMA: THE government is determined at incorporating online data services in the Value Added Tax base.

Minister for Finance, Dr Mwigulu Nchemba highlighted the importance of digital services in contributing to country’s revenue yesterday in the National Assembly, while tabling the national budget estimate for 2024/2025 Fiscal Year.

“The measure goes in line with providing a definition of the word online data services for clarity and smooth operationalisation of tax law,” Dr Nchemba said.

He said the move intends at broadening the tax base and taps the persisting global technological changes. On top of that, he said the government will continue to utilise Information Communication Technologies (ICT) to heighten tax compliance and simplify payment of taxes, fees and levies.

He said the country keeps on with the high pace of improving institutions’ systems that offer related services to issue an integrated payment invoice and ensure timely collection of revenue and service provision.

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Dr Nchemba said the government eyes intensive investment in ICT, to ensure systems interoperability, eliminate duplication and strengthen the monitoring and management of public funds.

In that regard, he emphasised all public institutions to ensure that all payments are collected through control number in order to control revenue leakage. He said the government under Dr Samia Suluhu Hassan has a specific objective of uplifting the national economy to a digital.

In achieving that, he said the government through the Bank of Tanzania has built and launched the Tanzania Instant Payments System (TIPS) in 2023/24 to facilitate interoperability of transactions from banks and mobile networks increasing efficiency and reduce transactions costs.

He said currently all commercial banks and companies offering mobile financial services have been integrated into the TIPS.

“The system enables transactions between person to person, person to business, and business to business,” he said.

Moreover, he noted that the government has been initiating another phase of the TIPS that will enable payments for goods and services through QR codes.