What was described in the Daily News as a ‘Consolidation Budget’ was presented to the National Assembly by Tanzanian Finance Minister Stephen Kibona on June 23 1991. The budget was generally welcomed as it continued the Tanzanian tradition of addressing the plight of the ordinary man whilst at the same time introducing a number of new measures aimed at improving the very weak state of the economy as a whole.
Some MPs complained about a lack of forward-looking economic planning. Amongst the many features of the budget were the following:
– reduction of customs duty and sales tax on sugar from 30% to 20% and waiving of tax on bread, tractor tyres and bottle coolers;
– new funds to be set up for road maintenance, housing and plot development, the funds coming from existing or new taxes and levies;
– substantial salary and wage increases; 40% increase on the minimum wage bringing it to TShs 3, 500; 15% increase for the highest level of civil servants; increased family allowances;
– decontrol of prices of sugar, beer, cement, tyres, corrugated sheets, bicycles; only petrol and fertiliser prices would remain controlled; (after subsequent objections from MPs the Government decided to retain control of sugar prices);
– a new TShs 80,000 tax on commercial, public and private companies for every car they own – aimed at reducing excessive expenditure on vehicles often used for private errands;
– airport service charge for residents raised to TShs 1,000; non-residents would continue to pay US$ 20;
– increase in hotel levy to 20% instead of 17.5%;
– increase in video library registration fees from TShs 30,000 to TShs 100,000; new annual fee on installation of satellite dishes TShs 50,000;
– rationalisation of tax assessments for small businesses; for example butcheries would pay TShs 10,000 annually, the revenue going to local governments;
– reductions in corporate tax to 45% for local firms and 50% for foreign firms;
– to encourage export of non-traditional products such as vegetables, flowers and meat, jet fuel prices reduced from TShs 69/95 to TShs 60 per litre and customs duty and sales tax on packaging material waived;
– Tanzanians staying abroad for more than one year would not need to pay customs duties on their imports including one tax exempt car every four years;
– ‘Bureaux de Changes’ would be opened at airports and border posts to facilitate exports – Daily News.