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· The mechanism for the collection and allocation of central revenues on mainland Tanzania is both efficient and effective. More than 50 percent of total collected revenue from the sector is directed back to fisheries via the retention scheme. This may be considerably less than that anticipated in the annual agreed rate of retention, but considering that the budgeting mechanism is obliged to underestimate revenue (to avoid the possibility of having insufficient funds for planned interventions) and that there is evidently high demand for finds in other sectors of the economy, the overall rate of retention is considered satisfactory.

· Decentralized revenue collection is by nature difficult to make effective and efficient. Costs of collection are high and it is difficult to establish effective systems to ensure reasonable rates of coverage. However it is estimated that in mainland Tanzania some US$3 millions per year of decentralized revenue is uncollected from the fishery. Should it be possible to increase effective coverage rates from 30 percent to 50 percent, a further US$1 million per year would be raised for local administration. Effective coverage is a function of not only the physical coverage of sales tax on transactions but also the mechanism in use for the collection of such revenue. Under the current implementation of the collection of local revenues via private collecting agents, physical coverage is potentially very high, but agents are permitted large margins and values received by local administration are estimated (LVEMP, 2001a) as only 40 percent of what is actually collected from the fishery. Local governments stand to gain significantly through improvements to the tendering process for the selection of collection agents.

· Total taxation of fisheries in mainland Tanzania already appears high, at nine percent of landed value, in spite of the inefficiencies in local taxation. Total taxation in Zanzibar is estimated at 2.5 percent of landed value.

· It is apparent that, in the immediate future, the greatest potential for the increasing of revenues from the sector (in both Zanzibar and mainland Tanzania) is via the licensing of EEZ fisheries. This will however require investment to establish appropriate institutions (a deep sea fisheries authority is already being discussed in Tanzania) and to institutionalise MCS activities. Without the latter, revenues from EEZ fisheries will be unreliable. Further investigation will be required on the feasibility of increasing EEZ licence fee rates, the structure of penalties and their legal foundation. This may form part of a forthcoming initiative focussing on marine resources, to be funded by GEF/IDA.

· Revenue generation from the fisheries sector in Zanzibar is very small compared to that of mainland Tanzania. This reflects both the scale of fishery and the view held until recently that the fishery has more social than economic importance. However, although the recent increase in revenue from the EEZ fishery has already caused this view to start to change, the real earning potential for the EEZ still requires further analysis so that realistic goals can be set.

· There is no evidence in the data presented in this study of changes in effort (and stock recovery) as a result of fiscal measures in the fishery. The brief analysis of effort and CPUE development made in this study points to the need for enhanced management measures in both of the major mainland fisheries: shallow water shrimp and Nile perch. The analysis of catch and effort in the shallow water shrimp fishery clearly needs to be expanded to include that of the artisanal sector, whose production is, according to some sources, up to twice that of industrial fisheries.

· The drop in revenue from mainland fisheries in 1999/2000 (when the EU banned the import of fisheries products from Lake Victoria on health grounds) underlines the dependence of government revenues on foreign market access, and consequently vulnerability to issues such as EU regulations that may impede access to such markets.

· Aquaculture currently makes no significant contribution to revenue generation in mainland Tanzania, in spite of it being a recognized policy priority. In Zanzibar, the culture of seaweeds makes significant contributions to export royalty earnings from the sector, but absolute values are low at under US$40 000 per year. The real value of seaweed culture is considered to be at community rather than central level. The potential for the mariculture of shallow water shrimps in (mainland) Tanzania is yet to be realized.

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