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The legal entity to collect tax in Tanzania is “Tanzania Revenue Authority in short TRA”. All businesses whether individuals or corporate entities must register for Tax Identification Number (TIN) and the services are offered by TRA free of charge.

There are two types of mandatory revenue or taxes in Tanzania.

1.     Direct Taxes
2.     Indirect Taxes

Direct Taxes

– Corporate Income Tax – 30%

Paid by an entity that does not qualify for VAT, ie it has an average of annual turnover of less than TZS 40 Millions.

 

– Withholding Taxes

• Dividends for company controlling 25% share or more – 10%

• Interest – 10%

• Royalties – 15%

 

Corporation Income tax

This tax is paid by all registered companies that do not qualify for VAT membership. The tax is paid on profit basis. 30% is charged annually to the profit attained by the company within such period

Licensing of a tourism business is a must step after registering a company. No one is allowed to operate in Tanzania without a business license except for micro business (has a turnover below 5 million)

Other taxes depend on your activities

Example if you own or a company own a car, building, machineries etc you must pay any applicable tax.

For more information about taxation and governing law in Tanzania visit the following websites

  1.  http://www.taxation-tz.com
  2. http://www.tanzania.go.tz/commerce.html
  3. http://invest-in.tanzania.ru/downloads/TAXATION%20IN%20TANZANIA.pdf
  4. http://www.tra.go.tz/index.php?option=com_content&task=category&sectionid=2&id=25&Itemid=69

Selection of technology to use, Procurement of working tools Equipment installation

Indirect Taxes

– Value Added Tax – 18%

– Import Duty – 0%, 10%, or 25%

  1. Value Added Tax (VAT)
  2. Corporation Income tax

Value Added Tax (VAT)

To qualify for VAT registration a company must attain a turnover of over TZS. 40 million consecutively in 3 years.  Otherwise such company will only pay Corporation income tax

About The Author

A Busi­ness, IT and Com­mu­nity Related Project Consultant

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