Tanzania Bakers Association seeks VAT exemption on baking equipment

Dar es Salaam. The Tanzania Bakers Association (TBA) has called on the government to reconsider its VAT exemption policy for baking equipment and products such as bread.

The association argues that VAT waivers would enhance public access to high-quality baked goods.

TBA Chairperson Francisca Lyimo notes that numerous tax charges present significant obstacles for the baking industry and impede the growth of small business owners, while also contributing to the failure of many enterprises.

“The baking industry plays a crucial role in the country, particularly in ensuring the constant supply of quality and safe food. These products are not luxuries but basic necessities, consumed by people across all social classes,” she said.

She made the remarks on August 28 at the Baker’s Dinner Gala and Awards Night, noting that since the inception of TBA in 2021, the industry has seen significant growth.

“We started with over 30 members, and now we have reached 305 members, with 1,500 individuals having undergone training,’ she said.”

According to her, the government should have incubation for small-scale businesses in order to develop a base of future tax payers.

Ms Lymo said it is unfortunate that when bakers start growing, levies and charges also increase, which increase the cost of operations.

Azania’s Group of Companies, Director of Business Joel Laiser, highlighted the challenges the baking industry faces, including the shortage of dollars in the country and the ongoing wars in Ukraine, though the situation has now stabilised.

“In the recent past, the baking business encountered difficulties, primarily due to the rising price of wheat. We also extend our gratitude to the government for enhancing road infrastructure and ensuring a reliable electricity supply, which has helped stabilise the baking industry,” he said.

Deputy Ministry of Home Affairs, Daniel Silo, commended the baking industry in the country for enabling Tanzanians to access nutritious and safe food for their health and urged them to submit their concerns to authorities so that they could work on them.

"Recognising the importance of the banking industry in promoting industrial economic growth and enhancing product quality, we advise you to utilise the tax committee by submitting all the challenges that hinder your business from thriving," he said.

The minister also praised the TBA for its commitment to training bakers and empowering them in their business endeavours, noting that these efforts significantly contribute to expanding the country’s economic landscape.

"Congratulations on your efforts to educate bakers, who, in addition to producing quality food products, will also drive economic growth and contribute to national revenue through their enterprises. Notably, you have educated 1,500 individuals, who are now actively involved in the baking industry."