TANZANIA – Traditionally, beer, cigarettes and soft drinks have been soft targets for Treasury to raise revenue annually during budget presentations.
SBL Managing Director, Helene Weesie told ‘Smart Money’ that in order to boost growth of the country’s beer market which is already paying massive taxes and employing millions.
“The beer industry in Tanzania is already making a major tax payment every year. We hope that our government will maintain the current excise duty levels in the next budget so that the industry continues to grow,” Weesie said.
She said SBL is not planning to increase prices of its products during the next financial year which starts on July 1.
Weesie said: “For the health of our business we need to continuously review our costs and revenues. Beer prices are set after careful consideration of various factors such as inflation, changes in input prices, purchasing power of consumers, prices of competing products and the tax regime.”
The SBL MD further noted that their brands are primarily produced for the local market, but they do occasionally export some based on specific orders abroad.
“In the last few years SBL has seen some significant increases in excise duty, which resulted in the declining of the beer market by around 5-6 percent, in fact, due to that, the beer market in Tanzania last year was at the level as five years ago,” she said.
Weesie further noted that last year was good to SBL because the company experienced solid growth of its key brands, notably our Pilsner Lager.
“We expect 2016 to be another positive year, although that will also depend a bit on what happens with the excise duty regime,” she noted.
What beer consumers say?
Geita Region resident and bear consumer, Alex Kabote said that the government should re-think when increasing taxes on locally made alcohol because it burdens taxpayers.
“We urged the government to maintain current levels of taxes because we are the ones who suffer when there is an increase,” Kabote said.
He pointed out that the government should strictly improve its tax collection by plugging loopholes instead of hiking them.
Mwanza Resident, Happy Mushi urged the government to review mining contracts as well as oil and gas contracts where it can collect more taxes instead of targeting beer and cigarettes.
“Cigarettes and beer have been main sources of government revenue compared to mining as well as oil and gas because there are very few people who are benefited from these natural resources,” she said.
May 19, 2016; http://www.ippmedia.com/business/sbl-hopes-treasury-will-not-hike-excise-duty-beer-alcohol