Determination of road user charges in Tanzania

The government of Tanzania is currently facing severe problems in financing the rehabilitation and maintenance of her highway system. Maintenance costs have risen because of the escalation in labour rates, equipment and material prices as well as generally stricter design standards for road maintenance. There is a long-standing tradition for highways maintenance and rehabilitation to be financed from general government revenues and loans and grants from International financing bodies. A few years ago user taxes were introduced through the road fund, this is because reliance on loans and grants is not a sustainable method of funding rehabilitation, while government revenues seem inadequate to cope with the maintenance load. Compounding the highway financing problem is the movement towards shipping goods in greater bulk by larger and heavier trucks. Concern exists that; (a) this practice accelerates wear and tear of the road structure, (b) heavier trucks usually do not provide enough additional user revenues to offset the increased costs that they impose. Collectively these changes in highway usage patterns and concomitant revenue shortages have created serious highway financing problems in the country. Resources for financing the road are scarce and infrastructure needs are many. Charging the user is not a problem, the problem is who should be charged for what, how should he/she be charged and how much should he/she pay for that particular service he/she received. Therefore, identification and choices of proper charging instruments have to be made to meet the identified maintenance and rehabilitation needs. A rational approach have to be found on how best to allocate the cost responsibilities among road users for payment. This study has tried to identify causes of inadequacy financing of road maintenance and proper charging instruments. Finally the study has proposed the road user charging structure by using the RUC-Model developed by the World Bank.