Q&A – 19 October 2015

Viagra in liquor

I read that some liquor companies that sell wines and other spirits have been putting prescription drugs like Viagra into their drinks. They guarantee good results beneath the bedsheets if you drink their wine. Is this legal?
OP, Dar

Lacing of drinks is a criminal and imprisonable offence. It is true that there was an international investigation on a number of liquor companies that were doing so. This type of lacing poses a human health risk and illegal in many jurisdictions including Tanzania.

Our research shows that a combination of viagra and alcohol can have serious unwanted health issues including heart palpitations.

The law in Tanzania can lead to the company and its officials to be criminally charged if found mixing such products without approval and knowledge of those consuming the drink.

This could well apply to the distributors if they distribute such beverages knowing that the lacing is illegal.

The Tanzania Food and Drugs Authority can address this and you should write to them.

Notification of workplace accidents

I own a big workshop and consult for engineering works in the oil companies. Last month, one of our employee was unfortunately involved in an accident and got seriously injured. We assisted this fellow on his treatment but although he has recovered he is now disabled. As a good gesture, we paid him a large sum as compensation and retained him but in a different position. Strangely, as a managing director I have been recently summoned to appear before the labour officers who are saying I have contravened the law for not reporting the accident. Are they correct?
RT, Musoma

The Accidents and Occupational
Diseases (Notification) Act [CAP 330 R.E.2002] under Section 3 provides that where any accident arising out of and in the course of the employment and causes loss of life to such worker or disables such worker for at least three consecutive days from earning full wages at the work at which he was employed at the time of such accident, a written notice of the accident, in the prescribed form, and accompanied by the prescribed particulars shall as soon as practicable be sent by the employer to the labour officer for the area within which the accident has occurred.

Provided that where to the knowledge of the employer, the accident has been reported or notified pursuant to the provisions of any other law and the written notice or report required by that law complies substantially with the prescribed form and contains the prescribed particulars the employer shall be deemed to have notified the accident in accordance with the provisions of this Act.

Also, where any accident causing disablement has been notified under this law and after such notification the accident results in the death of the person disabled, notice in writing of the death shall be sent by the employer to the labour officer for the area within which such accident has occurred as soon as the fact of the death comes to the knowledge of the employer.

This law has further stated that failure to comply with the notification is an offence and any person who commits an offence under this law for which no special penalty is provided by this Act is liable to a fine of five hundred shillings or to imprisonment for three months, or to both such fine and imprisonment.

It is also important to take notice that under this law, if an offence is committed by a company or other body of persons is proved to have been committed with the consent or connivance of, or to have been facilitated by any neglect of the part of any, director, president, chairman, manager, secretary or other officer of the company or body of persons, shall be deemed to have committed an offence and is liable to be proceeded against individually and punished accordingly.

After reading the above you will appreciate that since you have not complied with the law, the labour officer is right in summoning you.

You should push to pay a fine otherwise the alternative is to go to jail.

Local law inconsistent with double tax treaty

Our company is registered in a country which has a double tax treaty with Tanzania. There are provisions of the Income Tax Act which collide directly with the provisions of this treaty. In such a case what prevails- the local law or the treaty? How can we be sure?
ED, Dar

Section 7 of the newly enacted Tax Administration Act of 2015 which came into force on 1 August 2015 states that the provisions of an international agreement which the United Republic is a party shall, to the extent that the provisions of the agreement are inconsistent with any tax law, prevail over the provisions of the tax laws. The Act also defines international agreement as a treaty or other agreement which the United Republic signed with a foreign government for the purpose of providing reciprocal assistance for the administration or enforcement of tax laws.

Our reading of the above is that the double tax treaty is covered under the definition of international agreement.

The Income Tax Act is also one of the tax laws administered by the Tanzania Revenue Authority and we hence opine that any inconsistent provisions between the two will be ruled in favour of the international agreement which stands superior to our local tax laws.

To be sure of whether your interpretation and that of TRA is consistent, this newly enacted act allows you to apply for a private ruling where you can disclose all the facts of the matter and TRA will respond to you with their opinion in a ruling that is binding on the TRA. If the ruling is not in your favour, you may proceed to appeal the ruling at the Tax Revenue Appeals Board.