THE Parliamentary Committee for Industry, Trade and Environment plans to invite Prime Minister Kassim Majaliwa, key stakeholders and ministries responsible for ports’ management to a meeting in a bid to find a solution to the decline of cargo volume at Dar es Salaam Port.
The country’s major sea gateway has been experiencing massive decline in transit cargo traffic in recent months.
The reason for the decline ranges from
the country’s introduction of Value Added Tax (VAT) on transit goods and
strict tax collection measures imposed by the government.
Speaking to reporters shortly after
holding a number of meetings yesterday with port stakeholders and
Tanzania Port Authority (TPA) together with Tanzania Revenue Authority
(TRA), the Committee Chairman, Dr Dalaly Kafumu, hinted that the meeting
largely aims at addressing the situation.
"We held a meeting with port
stakeholders earlier. We heard their concerns and recommendations that
were geared to bring the port back on track as there is a steep decline
of cargo now as compared to previous years.
The port authority has admitted that the
cargo volume has dropped owing to a range of reasons. There is a need
for a joint meeting. We need to sit with the prime minister and other
responsible ministers to chart out a solution for this mess,” he noted.
Dar es Salaam Port is serving eight land
locked countries making it one of the country's main source of income.
Unfortunately, the port is now losing to other competitors due to what
was mentioned by the port stakeholders as 'unfriendly policies and
taxes'.
TPA Director General, Eng Deusdedict
Kakoko, confirmed that there is a decline of goods at the port, adding
that there is a number of reasons as to why goods declined at his port,
one of it being poor infrastructures and unsatisfactory railway
services.
"If we improve our logistics and transport systems we will win back the confidence of some of the customers we have lost.
There is no single reason as to why some
of our customers shifted to other ports. Poor infrastructure and the
fact that some dishonest stakeholders in the business discouraged
customers from using our port.
“However, there is a decline of copper
business worldwide. The situation, hence, leads to the decline of copper
cargo. We also had low security in some of our locations. This enabled
thieves to ambush transporting vehicles.
“But now the security has been improved.
We can easily win back some of the transporters,” said the TPA boss.
Eng Kakoko also agreed with other port stakeholders on the reviewing of
the Value Added Tax (VAT) charged to transit goods without interfering
good intention of TRA.
On his side, the TRA, Commissioner for
Customs and Excise, Mr Jocktan Kyamuhanga, said there is
misinterpretation on the VAT charged in transit goods. He made it clear
that there was no VAT on transit cargo.
He insisted that the tax was being
imposed only on the services. Tanzania Freight Forwarders Association
(TAFFA) President, Mr Stephen Ngatunga, said the auxiliary charges and
other charges increased ‘overnight’, a situation that discouraged
traders who initially used the Dar es Salaam Port.
“We have data that indicates that transit goods have declined by 42 per cent.
The decline is largely being attributed
to the recently introduced VAT on transit cargo. Our clients have
decided to opt for other ports,” he said. He said the trickle down
effects is bigger than it is estimated because youths who were employed
are now at risk of losing their jobs.
Others already have their work contracts
cancelled. TATOA decried what they termed as ‘overnight’ charges
increased by TRA. They cited the increase on the transit licence from 10
US dollars to 200 dollars which forced some of its members to abandon
the business.
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