CALL FOR CONSULTANCY : The Nexus between the Taxation of the Informal Sector and Inequality

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In Tanzania, there is a challenge of a large informal sector which has often gone untaxed hence subjecting a higher tax burden on the few within the formal sector. The informal sector is generally characterized by a high level of under-regulation by the government, cash transactions (which makes it difficult to properly track the amount of revenue generated), and improper-record keeping. As a result of these problems, the informal sector has been and remains very difficult to tax. This challenge of taxing the activities in the informal sector means that little or none of the income generated in the informal sector is transferred to the government in form of tax. Therefore, a very high percentage of potential tax revenue is unaccounted for.

It is upon this background that Policy Forum and Tax Justice Network Africa would like to conduct a research on the nexus between taxation of the informal sector and inequality. Specific objectives of the research are:

  • Analyze the trends of the growth/ decline of the informal sector in Tanzania over the years 2010/11- 2016/17.
  • Revenue collections foregone from the informal sector over the years 2010/11-2016/17.
  • Establish the level of inequality due to taxation or non-taxation of the informal sector.
  • Provide recommendations on how to improve revenue collections from the informal sector while at the same time reducing inequality in Tanzania.

Targeted Audience:

The outcomes of the research will target various players including:

  • Ministry of Finance and Planning (MoFP)
  • Tanzania Revenue Authority (TRA)
  • Members of Parliament (MPs)
  • Tanzania Investment Centre (TIC)
  • Civil Society Organisations
  • Private Sector
  • Media

Research Methodology

The following methodology/ tools shall be used to carry out the Study:

  • Desk Review: The research will make use of documents available at relevant Government’s offices (Policy documents, investments’ agreements, Legal instruments etc.).
  • Information requests to selected Government entities seeking to access public information deemed not only necessary but also relevant but not disclosed in public domain for more scrutiny.
  • Key Informant Interviews: The researcher will interview the relevant officials including Multi-National Corporations, Indigenous companies, Members of Parliament, Government officials from the Ministry of Finance and Planning, Tanzania Revenue Authority and Tanzania Investment Centre

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Expiration Date: 
Tuesday, September 26, 2017

All applications should be forwarded to Policy Forum,through or delivered by hand to our Mikocheni office not later than 25 September 2017.  Policy Forum will appoint a consultant by September 29, 2017.

The consultant will be responsible for delivering a draft report addressing the above research  by November 03, 2017, and a final report by November 10, 2017.

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