The Ministry of Finance's objectives are to continue building macroeconomic stability, to reduce poverty and to promote economic and fiscal independence. The following supportive policy frameworks and strategic initiatives have been established to achieve these objectives. - Objective 1: Continued stable macroeconomic performance: high GDP, low inflation and employment promotion.
- Objective 2: Poverty reduction
Objective 1: Continued stable macroeconomic performance: high GDP, low inflation and employment promotion. - Stable macroeconomic policy:
- Stable fiscal policy with reduced reliance on foreign resources in the medium-long
term. - Controlled Government fiscal deficits and limited Government borrowing, as guided by the National Debt Strategy.
- Targeted inflation.
- Private sector development and employment promotion:
- Active Government participation in the process of enabling a good business environment, particularly in fora with private sector stakeholders such as Investors Round Table;
- promotion of the Government's Business Environment Strengthening in Tanzania (BEST) programme including rationalization and simplification of the business licensing system;
- implementation of the National Microfinance Policy and Small and Medium Enterprises (SME) policy.
- Promotion of agriculture, Tanzania's largest sector and livelihood of the majority of the population
- Implementation of the Agriculture Sector Development Strategy which promotes production, profitability and exports.
- A fiscal regime supportive of commercial and subsistence agriculture.
- passing of the Land (Amendment) Act, 2003 to promote access to credit through collateralization of land in credit transactions.
- Promotion of Tanzania's brands on international markets, to boost the existing growth rates in the exports sector, particularly towards more diversified non-traditional exports in order to outlive the decline in international traditional commodity prices.
- Equitable and efficient tax policy conducive for private sector development but balanced with Government's revenue mobilization requirements:
- Implementation of a more efficient and equitable Income Tax Law, passed in April 2004;
- Abolishing of Local Government nuisance taxes in 2003/04.
- Continued improvements in tax administration through implementation of the TRA Corporate Plan 2003-2007, with the recognition that this can assist Tanzania's revenue mobilization efforts without hurting tax payers;
- Promotion of good governance and transparency; reduce the cost of doing business and minimize resource leakages in the Government system:
- Regular reporting by Ministries, Departments and Agencies (MDAs) of Government implementation under the National Anti Corruption Strategy and Action Plan (NACSAP) 2003-2005.
- Sustainable use of national resources:
- Increased ownership and accountability of natural resources.
- Integration of environmental issues and targets into Tanzania's Poverty Reduction
Strategy and Poverty Monitoring System.
Objective 2: Poverty Reduction - Establishing macro-micro linkages through better translation of Tanzania's macroeconomic benefits to poverty reducing outcomes. Use of poverty monitoring data to guide policy reform
- Continued support of the PRS sectors. Allocation of large amounts of expenditure to support key sectors including education, health, HIV/AIDS, agriculture, water, roads and the judiciary. Rising allocations since implementation of the PRS began in 2000 to approximately 46 percent of the total expenditure budget in fiscal year 2004/05.
- Revision of the PRS I in 2004 in order to make it more comprehensive and focus on: quality of service delivery; employment creation; outcomes; and integration of the UN Summit Millennium Development Goals (MDGs) into the national development agenda. A results oriented PRS will ensure that results are tangible for Tanzanians and their participation in the national challenge of reducing poverty.
- Promotion of public-private partnership in service delivery to assist Government in achieving its MDGs without over-reliance on foreign aid resources.
- Fiscal decentralization reforms to promote effective service delivery by Local Governments. Application of a strategic formula-based transfer system of recurrent grants from 2004/05 in order to allocate funds in the education and health sectors and for local development funds. System based on key indicators such as population and poverty levels in different councils thereby ensuring greater equity and efficiency. Roll out of the system to all sectors by 2005/06.
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