TANZANIA: Government allows religious groups to keep tax exemption

June 24, 2009

The government of Tanzania says it will keep tax exemptions for religious organizations, after Christian and Muslim leaders in the country lobbied for their retention.

"The church has been contributing to community development and we feel this exemption is very important," Anglican Bishop Simon Makundi of the Kilimanjaro diocese in northern Tanzania told Ecumenical News International on June 24.

The bishop said religious leaders were happy the government had agreed to keep the tax exemption.

"We shall continue to need it until a point in future, when the parties can agree it is no longer needed," said Makundi.

Tanzanian Prime Minister Mizengo Pinda announced that the tax emption was to remain in the proposal for the 2009-2010 budget estimates.

An earlier government document had suggested lifting the tax relief enjoyed by religious and some non-governmental organizations to swell government coffers.

"The president has blessed the decision to expunge the proposal. He has said the exemptions should be left," Mizengo Pinda, Tanzania's Prime Minister told journalists in Dar es Salaam on June 19.

Faith groups, including Anglicans, Roman Catholics, Mennonites, Lutherans and the Muslim Council of Tanzania, lobbied the government against its surprise proposal. The leaders warned the levy would cripple hospitals, schools and other services the groups provide throughout the country.

"The incentives play a big role in providing health services in the rural areas, where many poor people cannot afford expensive health services," said Roman Catholic Auxiliary Bishop Method Kilaini of Dar es Salaam.

Some of the items that will enjoy tax relief include medical equipment, infusion pumps, life supporting machines, laboratory equipment and hospital beds. Ambulances and mobile clinics will not be taxed.

The government, faith groups and NGOs are to form a task force to find ways of ending scandals and deceptions revolving around tax exemptions.