EDITORIAL: Enable private sectors to fosters economic growth
What you need to know:
While the private sector is described as the engine of economic growth, the government remains in control as the regulator. It should, therefore, put in place a conducive environment for the private sector to do what it should do.
Tanzania is currently implementing an industrialisation agenda which is meant to play a great role in graduating the country into a semi-industrialised, middle-income economy through the National Development Vision 2025.
To that end, efforts by both the government and the private sector are considered crucial for successful results.
While the private sector is described as the engine of economic growth, the government remains in control as the regulator. It should, therefore, put in place a conducive environment for the private sector to do what it should do.
The private sector has identified some of the hurdles that hamper growth, and has proposed measures which would help in ferreting out business opportunities. The challenges cited include the extant multiplicity of taxes and inordinately high tax rates, and policy unpredictability. This has almost always been the chorus in meetings involving the private sector.
Sometimes the complaint is NOT about the amount in taxes that businesses have to pay, but the burden associated with tax administration. Companies want the taxes and regulatory bodies consolidated for easy payment and regulation, leading to voluntary compliance. Policy predictability is also key in any country, as it creates certainty which helps investors to have long-term investment plans.
On the other hand, the business community appealed to the government to put in place an environment that would promote thriving and efficient industrial parks, create a level playing field and pay tax refunds it owes the private sector.
Delay in paying tax refunds affects investor liquidity. This is an administrative issue which can easily be sorted out.
The government has been quick in addressing issues as they arise, and, hopefully, it will also urgently look into these proposals and take appropriate measures just as promptly.
Although the challenges have been cited several times, the renewed spirit of industrialisation will hopefully prompt quick responses.
