Controller and Auditor General (CAG) Charles Kichere
Dar es Salaam. A new audit by the Controller and Auditor General (CAG) has uncovered widespread financial maladministration within Tanzania’s local government authorities.
The maladministration involves either uncollected or misused billions of shillings, posing a serious threat to essential service delivery and the country’s development goals.
The Annual General Report for the Audit of the President’s Office – Regional Administration and Local Government Authorities (PO-RALG) for the 2023/24 financial year highlights alarming weaknesses in revenue collection, tax enforcement, and contract supervision across 158 local government authorities (LGAs).
CAG Charles Kichere reported that Sh44.96 billion in local revenues was not collected, including uncollected income from market stalls, shop rentals, liquor licences, and land plot sales.
In addition, Sh12.85 billion was paid without proper Electronic Fiscal Device (EFD) receipts, while revenue agents failed to collect Sh26.12 billion.
“These discrepancies point to weak internal controls and poor governance. Immediate corrective measures are needed to improve transparency, accountability, and financial discipline,” the CAG warned.
The audit attributed the uncollected revenue to poor communication with business owners, weak debt recovery mechanisms, and inadequate staffing in revenue departments.
“I recommend that PO-RALG and LGAs establish stronger internal controls, enforce effective debt recovery strategies, and improve taxpayer engagement,” Mr Kichere stated.
The report also revealed that 41 LGAs, two regional secretariats, and the Tanzania Rural and Urban Roads Agency (Tarura) made payments without valid EFD receipts, breaching the Tax Administration Act.
Some receipts—totalling Sh61.93 million—could not be traced, while receipts worth Sh217.18 million only accounted for Sh18.98 million in the Tanzania Revenue Authority (TRA) system.
Although a portion of the receipts was later replaced, about Sh52.23 million remained unaccounted for.
“The government must strengthen its collaboration with TRA and the Ministry of Finance to fully enforce EFD regulations. Suppliers using fake receipts should be prosecuted to deter fraud,” the CAG urged.
Revenue agents also came under fire for underperformance. In 14 LGAs, agents were contracted to collect Sh45.61 billion but recovered only Sh19.49 billion—a shortfall of Sh26.12 billion.
“This stems from poor contract management and the lack of proper feasibility studies,” the report said, recommending that future contracts include collateral clauses to ensure recovery when agents underperform.
Contacted for comments, experts in governance and tax administration gave differing opinions aimed at improving the trend within LGAs.
Governance specialist, Dr Rehema Kweka described the findings as symptomatic of systemic failure.
“We need greater transparency, digitised financial systems, and well-trained personnel at the local level,” she said.
“There must also be accountability, including suspensions and prosecutions,” added Dr Kweka.
Tax consultant, Ms Sophia Mshana, added, “Missing EFD records point to potential tax evasion and collusion between suppliers and public officials.”
