Trump nominates new American Ambassador to Tanzania: Spearheading tourism

United States President Donald Trump named then nominated a new Ambassador to Tanzania, after nearly 3 years of the US Embassy in Tanzania’s commercial capital of Dar es Salaam running without an appointed ambassador.

Trump nominated Dr. Don J. Wright of Virginia as his new envoy to Tanzania. The White House announced the nomination of Dr. Wright on September 30 of this year. He is set to be vetted by the US Congress and Senate before taking up his post in Tanzania. When confirmed, Dr. Wright will succeed Mark Bradley Childress who served as US ambassador to Tanzania from May 22, 2014, to October 25, 2016.

After taking over his new position in Dar es Salaam, the new US ambassador is expected to spearhead economic diplomacy between Tanzania and US tourism – the leading economic sector in which Tanzania is looking for an American partnership. The United States is the second of high-class tourists visiting Tanzania every year. Over 50,000 Americans visit Tanzania every year.

Up until now, the US Embassy in Tanzania’s commercial capital of Dar es Salaam is under the Senior Foreign Service Officer (FSO) Dr. Inmi Patterson who has been Chargé d’Affaires of the mission since June 2017.

Dr. Wright is a career Senior Executive Service (SES) member and is currently working in the Department of Health and Human Services (HHS) in the United States.

Reports from the US State Department said that Dr. Wright developed and implemented the National Action Plan to Reduce Healthcare-Associated Infections and Healthy People 2020, the US’ framework for disease prevention and health promotion initiatives.

His career at HHS includes service as acting Assistant Secretary for Health and acting Executive Director of the President’s Council on Sports, Fitness, and Nutrition.

He received his BA at Texas Tech University in Lubbock, Texas, and his MD at the University of Texas Medical Branch, Galveston, Texas. He received an MPH at the Medical College of Wisconsin in Wauwatosa. He was honored by the American College of Preventive Medicine in 2019.

The United States is the leading donor to the development of health services in Tanzania, mostly contagious tropical diseases and HIV AIDS, among other diseases, including malaria.

While in Tanzania, Mr. Childress will oversee, among other political and economic issues, the US support to Tanzania in areas of health, human rights, and wildlife conservation.

The United States is the leading donor to Tanzania in health projects targeting malaria eradication, Tuberculosis and HIV/AIDS prevention, safe-motherhood, and health education programs.

Tanzania is among African countries doomed with tropical and communicable diseases including the recently-diagnosed dengue fever outbreak which had hit several parts of this African nation.

With budget constraints in health services, Tanzania depends on donor support, mostly from the United States, Britain, Germany, and Scandinavian states to finance health projects. Wildlife conservation is the other area which the US government has committed to supporting Tanzania for the last few years. America has been on the frontline to assist Tanzania in anti-poaching campaigns aimed to save African elephants and other endangered species from extinction from poaching.

The US government has also been supporting Tanzanian and other African nations in fighting international terrorism and piracy in the Indian Ocean.

Bleak Future For Tanzania Small Tour Operators As Tax Regime Bites

Many small-scale companies in the tourism and hospitality sector in Tanzania are facing a bleak future as they are finding it difficult to comply with the tax regime.

Players say the Value Added Tax (VAT) in particular, is likely to kick-out the SMEs in the tourism and hospitality business if the Tanzania government doesn’t revisit its administration.

Tanzania Association of Tour Operators (TATO) and Hotels Association of Tanzania (HAT) say many of their members are concerned with the VAT treatment of deposits or advance payment in the tourism business.

“Majority members were finding it very hard to work out the accounting complexities of paying VAT on deposits,” TATO CEO, Sirili Akko said in Arusha.

He added: “Smaller tour operators and hoteliers don’t necessarily have access to high-level finance staff and therefore were at a loss as to how to deal with the issue in a compliant manner.”

Sector players add that though it makes no difference to the total amount collected by the Tanzania Revenue Authority (TRA), it vastly increases the complexity of the accounting and the difficulty of the administration of this for both the companies and the revenue authority.

“It is a widely held belief that clear and straightforward tax regimes help revenue authorities to maximize compliance, as well as helping to increase the tax base by encouraging further investment,” Akko explains.

The TATO and HAT members meeting agreed to set up a technical committee to clarify the challenges and prepare a plan to meet with the Ministry of Finance to agree a way forward that would ensure that payment and administration of VAT are as straight forward as possible.

“Both TATO and HAT can then educate and help all of their members to be as compliant as possible,” said HAT CEO, Ms. Nuralisa Karamagi.

“The majority of players in the tourism and hospitality sector consider the provision of section 15 of the VAT Act, 2014 to be problematic when receipts of deposits trigger it,” Dr. Deogratius Mahangila who undertook the study notes.

First, he says, a deposit in the tourism sector indicates that the client is committed to traveling and therefore, the operator has to confirm the need for accommodation, transfers, flights, and vehicles with suppliers and the suppliers ought to reserve the space for these bookings.

According to the respondents’ opinions, the pre-payment is not a consideration for the supply, as a deposit is used to secure space on behalf of a customer—typically accommodation, vehicles or seats on airplanes.

“It is a commitment as these spaces are limited in supply and therefore require prior booking,” Dr. Mahangila says, adding: “Typically, any deposit made will be deducted from the final payment due, but the exact nature of the service can and does change after a pre-payment has been made.”

Indeed, deposits are not income. The tourism sectors essentially hold this money in trust for their client for the future service and therefore the money remaining after the service is rendered, becomes income for tour operators.

The government had in December 2017 reviewed the Tanzania Tourism business License popularly known as Tala to attract local SMEs in the formal sector in a bid to expand its tax base.

Before the government’s decision, many briefcase firms clandestinely provided services to tourists to evade tax and often to con their customers at the expense of the country’s tourism image.