DAR ES SALAAM, June 1 (Xinhua) -- Tanzanian President John Magufuli on Thursday launched an electronic revenue collection system and ordered all telecom firms in the east African nation to list on the Dar es Salaam Stock Exchange (DSE) as required by the law.
Magufuli said some of the telecom companies that have not listed on the DSE were doing so to avoid transparency on tax payments.
Speaking at the launch of the Electronic Revenue Collection System (e-RCS) in the commercial capital Dar es Salaam, Magufuli said telecoms firms dismissed fines by the Tanzania Communications Regulatory Authority (TCRA) for failure to list on the DSE as a drop of water in the ocean.
"They (the telecom firms) have opted not to register on the stock market as required by law. They should be punished for disobeying the law," warned the President.
He added: "For a company that gets billions of shillings in profit, it is easy to opt for fines instead of offloading shares as required by the law, so TCRA do not fine them but deregister them," he said, adding: "We should reach a point where we should make serious decisions even if they are painful."
All telecom firms operating in Tanzania are required to list 25 percent of their shares on the DSE according to the Electronic and Postal Communications Act 2010, amended in June under the Finance Act.
The deadline for the companies to list was December 31, 2016 and only Vodacom out of the seven-telecom companies have complied with the requirement. Other major telecom firms operating in Tanzania are Celtel, Tigo, Zantel and Halotel.
He called upon the telecom companies to offload their shares, saying the government was ready to facilitate a conducive environment for doing business even if it involved amending laws.
The new system will automatically be calculating, assessing and collecting the required amount of revenue and send them to relevant accounts of both the Tanzania mainland and Zanzibar governments in their accounts at the Bank of Tanzania (BoT) without human intervention.
The launch of the system spelt the end of complaints from tax-payers on the exact amount of revenue collected from online transactions.
Tanzania is the second largest telecom market in East Africa behind Kenya, with a penetration of 79 percent of the total population, with subscribers estimated at 40 million in 2015.
In the past five years, landline subscriptions decreased by 22 percent, from 174,511 in 2010 to 142,819 in 2015, while mobile subscriptions rose by 89 percent, from 21 million in 2010 to almost 40 million last year. Enditem