DogoWaNjombe
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- Feb 7, 2022
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Mahakama ya Rufani imeiagiza Kampuni ya Vodacom Tanzania Public Limited Company kuilipa Mamlaka ya Mapato Tanzania (TRA) zaidi ya shilingi bilioni 1.4, ikiwa ni riba ya kodi ya zuio (withholding tax) kutokana na kuchelewesha kulipa kodi hiyo inayotokana na riba ya Mikopo ambayo kampuni hiyo iliipata kutoka kampuni dada za Vodacom Group na Mirambo.
Amri hiyo ya Mahakama ya Rufani imetolewa na jopo la majaji watatu, ambao ni Winfrida Korosso, Sam Rumanyika na Abdul-Hakim Ameir Issa baada ya kukubali rufaa iliyokatwa na Kamishna Mkuu wa TRA dhidi ya Vodacom, wakipinga uamuzi wa Bodi ya Rufaa ya Kodi na Baraza la Rufaa ya Kodi.
"Mwenendo na hukumu za Bodi na Baraza la Rufaa la Kodi zinabatilishwa, Mjibu rufaa anaamriwa kulipa riba hiyo kwa mujibu wa ukugazi wa kodi uliofanywa na Mrufani” walieleza majaji hao katika hukumu iliyotolewa Aprili 8, 2025 jijini Dodoma.
Katika maamuzi yao ya awali, Bodi na Baraza la Rufaa ya Kodi waliamua kuwa wajibu wa kulipa Kodi ya zuio unatokea wakati riba inalipwa na si wakati mpokeaji wa riba anapopata haki ya kupokea malipo hayo (inaanza kutozwa). Kwa kuwa Vodacom ililipa na kuwasilisha kodi hiyo kwa TRA kwa mujibu wa kifungu cha 82(1) na 84(1) cha Sheria ya Kodi ya Mapato, basi haikuwa sahihi kisheria kutozwa riba kwa kuchelewa kulipa kodi hiyo.
Wakati wa kusikiliza rufaa hiyo, upande wa TRA uliwakilishwa na Mawakili wa Serikali Wakuu Hospis Maswanyia na Juliana Ezekiel wakisaidiwa na Mawakili wa Serikali Octavian Kichenje na Nicodemus Agweyo huku Vodacom walikuwa na mawakili Yohanes Konda na Thompson Luhanga.
Majaji walichambua Sheria ya Kodi ya Mapato na kubaini kuwa tafsiri nyembamba ya neno "analipa" iliyotolewa na Bodi na Baraza ilikuwa si sahihi kisheria, kwani neno hilo limetumika kwa maana ya kiufundi.
Kwa mujibu wa kifungu cha 21(3), makampuni yanapaswa kutumia mfumo wa kutambua mapato kwa msingi wa kutoza (accrual basis). Kwa hiyo, walihitimisha kuwa kampuni inapaswa kulipa Kodi ya zuio ya riba mara tu riba hiyo inapotakiwa kulipwa, hata kama haijalipwa bado.
Court of Appeal Orders Vodacom Tanzania Public Limited Company to Pay TRA Shs 1.4bn/ in a Land Mark Appeal
THE Court of Appeal has ordered Vodacom Tanzania Public Limited Company to pay over 1.4bn/- to the Tanzania Revenue Authority-TRA- being interest on late payment of withholding tax on interests paid on loans obtained from Vodacom Group and Mirambo.
‘The proceedings and judgments of the Board and Tribunal are hereby quashed and set aside. The respondent is ordered to pay the interest in accordance with the assessment made by the appellant,’ they declared in the judgment dated April 8, 2025 delivered in Dodoma.
Justices Winfrida Korosso, Sam Rumanyika and Abdul-Hakim Ameir Issa, gave such orders after allowing an appeal lodged by Commissioner General of TRA, the appellant, against Vodacom Tanzania Public Limited Company, the respondent, to challenge the findings of the Tax Revenue Appeals Board and the Tax Revenue Appeals Tribunal which decided that the withholding obligation arises when the interest on loans is paid and not when it accrues, thus since the respondent paid and remitted the withholding taxes to the appellant as required under section 82(1) and 84(1) of the Income Tax Act, the imposition of interest for the late payment was not correct in law.
During hearing of the appeal in the Court of Appeal, the appellant, the Commissioner General was represented by Principal State Attorneys Hospis Maswanyia and Ms. Juliana Ezekiel, assisted by State Attorneys Octavian Kichenje and Nicodemus Agweyo, while the respondent enjoyed the services of Advocates Yohanes Konda and Thompson Luhanga.
The Counsel for the appellant submitted that Tribunal erred in law by interpreting the word pays and misconstruing section 82(1) of the Income Tax Act, 2004 to mean withholding tax obligation arises when interest is actually paid and not on accrual basis and that the imposition of interest on loan for late payment has no legs to stand.
Responding, the counsel fort the respondent submitted that withholding obligation is not imposed under section 3, 21 or 23 of the Act, rather it is section 82(1) of the ITA that imposes a withholding obligation on a resident person who pays interest or rent.
In their deliberations, the justices said that under the law, corporation such as the respondent is required to deal with its tax issues on the accrual basis and Section 21(3) has been couched in a mandatory term that a corporation shall account its income tax on accrual basis.
Therefore, the justices ruled that a corporation is obliged to pay the withholding tax of interest on loan when that interest is payable and not when she actually paid the interest.
They said that failure to pay the tax when it was due will attract the payment of interest for the delay in accordance with section 76(1) of the Tax Administration Act.
‘Therefore, the Board and Tribunal erred in their findings that the imposition of interest on loan for late payment has no leg to stand on. They erroneously reached that conclusion after making a wrong finding that the withholding tax of interest on loan should be paid when the interest is paid and not when it accrues…
‘We are of the settled view that, it was a wrong approach. Therefore, the late payment of withholding tax like other forms of taxes will attract interest as well. Hence, the appellant was entitled to claim interest on the delayed payment,’ the justices ruled.
Facts show that the respondent took loans from her sister companies, Vodacom Group and Mirambo. From Vodacom Group, she took loans in 2004, 2007 and 2009 while the loan from Mirambo was granted in 2009.
The respondent had a duty to pay interest annually, but did not pay. Instead, the payment of interest to the Vodacom Group was made from the year 2015 onwards and 11withholding tax was paid to the appellant on 2015. With respect to the loan from Mirambo, the payment of interest was made from 2009, but the withholding tax was paid in 2017.
The appellant conducted an audit into the tax affairs of the respondent for the years of income 2011 to 2012, in order to satisfy itself on the respondent's compliance with tax laws.
The audit culminated into issuance of withholding tax certificate communicating the assessment and liability of withholding tax in the amount of 7,779,581,441/-, which includes the principal tax of 6,290,902,580/- and interest thereon of 1,488,678,861/- in respect of the said years of income.
Chanzo: TRA
Amri hiyo ya Mahakama ya Rufani imetolewa na jopo la majaji watatu, ambao ni Winfrida Korosso, Sam Rumanyika na Abdul-Hakim Ameir Issa baada ya kukubali rufaa iliyokatwa na Kamishna Mkuu wa TRA dhidi ya Vodacom, wakipinga uamuzi wa Bodi ya Rufaa ya Kodi na Baraza la Rufaa ya Kodi.
Katika maamuzi yao ya awali, Bodi na Baraza la Rufaa ya Kodi waliamua kuwa wajibu wa kulipa Kodi ya zuio unatokea wakati riba inalipwa na si wakati mpokeaji wa riba anapopata haki ya kupokea malipo hayo (inaanza kutozwa). Kwa kuwa Vodacom ililipa na kuwasilisha kodi hiyo kwa TRA kwa mujibu wa kifungu cha 82(1) na 84(1) cha Sheria ya Kodi ya Mapato, basi haikuwa sahihi kisheria kutozwa riba kwa kuchelewa kulipa kodi hiyo.
Wakati wa kusikiliza rufaa hiyo, upande wa TRA uliwakilishwa na Mawakili wa Serikali Wakuu Hospis Maswanyia na Juliana Ezekiel wakisaidiwa na Mawakili wa Serikali Octavian Kichenje na Nicodemus Agweyo huku Vodacom walikuwa na mawakili Yohanes Konda na Thompson Luhanga.
Kwa mujibu wa kifungu cha 21(3), makampuni yanapaswa kutumia mfumo wa kutambua mapato kwa msingi wa kutoza (accrual basis). Kwa hiyo, walihitimisha kuwa kampuni inapaswa kulipa Kodi ya zuio ya riba mara tu riba hiyo inapotakiwa kulipwa, hata kama haijalipwa bado.
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Court of Appeal Orders Vodacom Tanzania Public Limited Company to Pay TRA Shs 1.4bn/ in a Land Mark Appeal
THE Court of Appeal has ordered Vodacom Tanzania Public Limited Company to pay over 1.4bn/- to the Tanzania Revenue Authority-TRA- being interest on late payment of withholding tax on interests paid on loans obtained from Vodacom Group and Mirambo.
‘The proceedings and judgments of the Board and Tribunal are hereby quashed and set aside. The respondent is ordered to pay the interest in accordance with the assessment made by the appellant,’ they declared in the judgment dated April 8, 2025 delivered in Dodoma.
Justices Winfrida Korosso, Sam Rumanyika and Abdul-Hakim Ameir Issa, gave such orders after allowing an appeal lodged by Commissioner General of TRA, the appellant, against Vodacom Tanzania Public Limited Company, the respondent, to challenge the findings of the Tax Revenue Appeals Board and the Tax Revenue Appeals Tribunal which decided that the withholding obligation arises when the interest on loans is paid and not when it accrues, thus since the respondent paid and remitted the withholding taxes to the appellant as required under section 82(1) and 84(1) of the Income Tax Act, the imposition of interest for the late payment was not correct in law.
During hearing of the appeal in the Court of Appeal, the appellant, the Commissioner General was represented by Principal State Attorneys Hospis Maswanyia and Ms. Juliana Ezekiel, assisted by State Attorneys Octavian Kichenje and Nicodemus Agweyo, while the respondent enjoyed the services of Advocates Yohanes Konda and Thompson Luhanga.
The Counsel for the appellant submitted that Tribunal erred in law by interpreting the word pays and misconstruing section 82(1) of the Income Tax Act, 2004 to mean withholding tax obligation arises when interest is actually paid and not on accrual basis and that the imposition of interest on loan for late payment has no legs to stand.
Responding, the counsel fort the respondent submitted that withholding obligation is not imposed under section 3, 21 or 23 of the Act, rather it is section 82(1) of the ITA that imposes a withholding obligation on a resident person who pays interest or rent.
In their deliberations, the justices said that under the law, corporation such as the respondent is required to deal with its tax issues on the accrual basis and Section 21(3) has been couched in a mandatory term that a corporation shall account its income tax on accrual basis.
Therefore, the justices ruled that a corporation is obliged to pay the withholding tax of interest on loan when that interest is payable and not when she actually paid the interest.
They said that failure to pay the tax when it was due will attract the payment of interest for the delay in accordance with section 76(1) of the Tax Administration Act.
‘Therefore, the Board and Tribunal erred in their findings that the imposition of interest on loan for late payment has no leg to stand on. They erroneously reached that conclusion after making a wrong finding that the withholding tax of interest on loan should be paid when the interest is paid and not when it accrues…
‘We are of the settled view that, it was a wrong approach. Therefore, the late payment of withholding tax like other forms of taxes will attract interest as well. Hence, the appellant was entitled to claim interest on the delayed payment,’ the justices ruled.
Facts show that the respondent took loans from her sister companies, Vodacom Group and Mirambo. From Vodacom Group, she took loans in 2004, 2007 and 2009 while the loan from Mirambo was granted in 2009.
The respondent had a duty to pay interest annually, but did not pay. Instead, the payment of interest to the Vodacom Group was made from the year 2015 onwards and 11withholding tax was paid to the appellant on 2015. With respect to the loan from Mirambo, the payment of interest was made from 2009, but the withholding tax was paid in 2017.
The appellant conducted an audit into the tax affairs of the respondent for the years of income 2011 to 2012, in order to satisfy itself on the respondent's compliance with tax laws.
The audit culminated into issuance of withholding tax certificate communicating the assessment and liability of withholding tax in the amount of 7,779,581,441/-, which includes the principal tax of 6,290,902,580/- and interest thereon of 1,488,678,861/- in respect of the said years of income.
Chanzo: TRA
