Dar es Salaam. In a bid to reform the country’s economy, a new proposed investment law tabled for first reading seeks to encourage and attract more trade and investment both domestically and internationally.
Only speak to The citizen After the parliamentary session, Dr. Ashatu Kijaji, Minister of Investment, Industry and Trade, said the new law is intended, among other things, to encourage, encourage and increase local participation in the economy.
“President Samia Suluhu Hassan’s aspiration is to provide the country with a suitable investment climate that attracts more businesses, so the proposed investment law is one of the tools that will make our President’s dream come true [Samia Suluhu Hassan] be realized,” she explained.
According to her, the government has reduced the capital requirements for a locally owned company by 50 percent to enjoy the benefits and protections under the Investment Act 1997; As before, the minimum investment value for such projects was $100,000.
“We want to encourage, encourage and facilitate more local investment, mind you, 78 percent of the country’s big taxpayers; are those registered with the Tanzania Investment Center (TIC), which in turn issues incentive certificates, giving holders entitlement to various incentives as set out in the Investment Act 1997,” he noted.
According to the law (of 1997), it defines incentives as tax credits and preferential tax rates that an investor can access under the Income Tax Act, the Tariff Act, the Tanzania Revenue Authority Act, the Value-Added Act and any other currently applicable law and contains additional benefits accessible to an investor under Sections 19 and 20 of the Tanzania Investment Act 1997.
dr Kijaji further explained that the draft law intends to harmonize all laws related to investments by making the new proposed Investment Law 2022 a top-level legislation on investment matters and that all other laws must reflect this.
“We faced some challenges in terms of tax incentives and such, because sometimes the investment law gives relief for a particular project, but sometimes there is some bureaucracy in implementation, just some laws are not consistent with the stated incentives. ‘ she remarked.
Adding: “Even with the National Investment Steering Committee (NISC) which the Prime Minister chairs, their decisions were sometimes unworkable, the difficulties were due to the law in force, so with the proposed one things will go smoothly.”
Although the new 1997 Investment Act will no longer apply once the proposed legislation comes into force, anything done under the previous 1997 Act will retain its legal entity status and benefits such as investment incentives under the new Act.
as dr Amina Abubakar, an independent economist, when asked to comment, said: “Although I haven’t read the bill in question, I think it’s a good job to have more local investment means the money is kept locally .”
She added: “I’m sure the bill will also reduce revenue and tax complaints as, when enacted, it will become the main law for all matters related to investment and trade.” I see this as a positive if we want to have a favorable environment for trading.”
Mr Warson Jumanne, business practitioner, believed the proposed law will act as an incentive for both foreign and local investment, which in turn will create more jobs.
“I am sure that it will be an effective tool to attract investors, this will increase more state export revenues and diversify the economy by allowing private companies, especially small and medium-sized ones, to function, positively contribute to the creation of jobs and is therefore good for the economy,” he clarifies.
Tanzania offers a wealth of market opportunities for both domestic and foreign markets. The country’s rapid economic growth and high domestic investment, with a 20 percent city share, provide a sizeable market that will remain an important destination for local and foreign products and services.
The country is part of two distinct market areas: East African Community (EAC), which comprises seven countries, and Southern Africa Development Community (SADC), totaling over 527 million consumers.
Tanzania is trading partner with some countries of the European Union (EU), China, India, the United Kingdom (UK), the United Arab Emirates (UAE) and the United States (USA).