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Zanzibar woos investors with plan to ban levies on air tickets

Saturday June 23 2018
zanzibar

A street in Zanzibar. The isle is seeking to boost industrialisation. PHOTO | FILE

By KILASA MTAMBALIKE

Zanzibar, the semi-autonomous Tanzanian archipelago, plans to abolish stamp duty on air tickets in order to attract more visitors and investments to the Isles, as part of its industrialisation agenda.

In its Tsh1.3 trillion ($580 million) 2018/19 budget presented in the House of Representatives by Finance Minister Dr Khalid Mohammed, Zanzibar has prioritised local industries, job creation and infrastructure.

While proposing the scrapping of stamp duty, Dr Mohammed said that air tickets for international travel issued on the mainland do not attract duty and thus the need to abolish the levy in Zanzibar, in order to harmonise taxes while bolstering air travel.

Sugar production

He said that there was also a need to reduce or scrap tax incentives on imported sugar, cereals and other food items because production on the Isles had increased.

This, the minister told the House, as a result of improvements made at the Zanzibar Milling Corporation and the revival of Mahonda Sugar Factory.

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As part of its industrialisation agenda, the government will construct an industrial park to boost small-scale manufacturing.

The government will also work towards strengthening agro-processing in Unguja and Pemba Islands to assist farmers to add value to produce before shipping it from the Isles.

From domestic sources, the Isles government expects to collect more than Tsh807.5 billion ($355 million), an increase of 18.7 per cent from the 2017/18 financial year estimates, which stood at Tsh680 billion ($299 million).

More than Tsh702 billion ($308 million) from the budget will be spent on recurrent expenditure and over Tsh613 billion ($269 million) on development projects.

To ensure that jobs are created for the youth, the Isles government has allocated over Tsh3 billion ($1.3 million) for the establishment of a youth employment programme. Youth will access capital for start-ups following successful proposals.

The government has also allocated Tsh487.5 billion ($214.5 million) for infrastructure development and social service provision; the health sector has been allocated Tsh93.3 billion ($40.9 million); while education and vocational training will receive Tsh179.6 billion ($79 million).

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