Government institutions convened with civil society organisations for a two-day session on 29 and 30 April 2021 to capacitate CSOs on compliance governing their operations in Tanzania. Discussions were specifically aimed at equipping CSOs with in-depth knowledge on tax compliance and employee protection
The session is a part of the Foundation for Civil Society’s initiative to support the growth of the civil society sector in Tanzania and contribute to national development through the operations of CSOs. The session was organised in collaboration with the National Council of Non-governmental Organisations (NaCoNGO), the Tanzania Network of Non-Governmental Organisations (TANGO) as well as Equality for Growth (EfG).
State institutions in attendance were the National Social Security Fund (NSSF), Tanzania Revenue Authority (TRA), Occupational Safety and Health Authority (OSHA) and Workers Compensation Fund (WCF).
FCS’ Capacity Development Manager, Edna Chilimo, said such sessions bridge the knowledge gap among CSOs on legal frameworks governing the civil society sector in Tanzania, and help civil society in fulfilling compliance requirements. She added that it is part of FCS’ vision to facilitate the growth of the civil society sector.
Speaking during the session, Maternus Mallya, TRA Senior Tax Officer, said civil society organisations are governed by various tax laws, and compliance in the sector encompasses a wide range of taxes.
“CSOs are required to register with TRA. As taxpayers, five laws govern CSOs’ operations, and these are the Tax Administration Act, Income Tax Act, (Corporation, WHT, PAYE), Value Added Tax Act (VAT), Vocational Education Training Act (Skills and Development Levy), Stamp Duty Act (Stamp duty to authenticate transactions) and the East African Community Customs management Act (Import duty),’’ he said.
CSOs are required to file statements showing estimated income and tax payable and prepare audited accounts in every year of income. Under the law, every organisation is required to submit tax returns even if it has no taxable income. CSOs’ mode of operation is dynamic. Filing of returns enables them to communicate various changes and keep the Commissioner updated all the time.
“CSOs’ salary payments are subjected to PAYE. The minimum threshold amount is currently TZS 270,000. Monthly returns are submitted to TRA before the 7thday of the month following the month of payroll. Half-year certificates which tally with the monthly returns are submitted to TRA during the period within 30 days after the end of each six-month calendar period,’’ Mr Mallya said.
He insisted on meeting the required TRA deadlines. For WHT, withholding taxes must be paid within seven (7) days after the end of a calendar month. Entities, including non-profit organisations, are only considered charitable organisations after they have been issued with the Commissioner’s private ruling. In principle, charitable organisations within the context of the relevant law are treated as conducting charitable business, and hence are not exempted from income tax, but rather, their chargeable incomes are determined in accordance with the provisions of the tax law.
Officials from OSHA, NSSF and WCF explained the responsibilities of employers in protecting their employees and their benefits.
Joseph Fungo, the NSSF Regional Manager, said that NSSF is responsible for employees in the private and informal sectors, and this includes the civil society sector.
“Under the law, employees must ensure that the organisation is registered with NSSF, and that all employees are registered, as well remitting their contributions to the fund.’’
Mr. Fungo said that failure to remit contributions within one month after the end of the month will lead to the employer being penalised five per percent of the unremitted contribution or unpaid amount. The amount must be paid in 30 days.
“It is best to avoid delays in remitting contributions. Organisations are supposed to work with our inspection officials. Assault and intimidation against an inspector, or roughing up an inspector during visits is an offence that is punishable by a fine not exceeding ten million shillings or imprisonment for two years or both,’’ said Mr. Fungo.
Ally Omary Mwege from OSHA said the institution is responsible for protecting employees against the dangers that exist in the workplace that can lead to illness and accidents. The institution works to ensure that employees work in an environment that is safe and secure by complying with procedures in place to prevent accidents and occupational diseases. It is also responsible for reducing or completely eliminating accidents, occupational illnesses and deaths in the workplace throughout mainland Tanzania. OSHA provides training to ensure that its employees have the necessary skills and expertise to carry out their day-to-day responsibilities.
Said Ismail from WCF said the fund applies to all employers and employees in Mainland Tanzania and is meant to provide for adequate and equitable compensation for employees who suffer occupational injuries or contract occupational diseases arising out of and in the course of their employment.