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United Republic of Tanzania  
  • Mwl. Julius K. Nyerere
  • Sheikh Abeid Amani Karume
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Home BusinessTrade and Taxation

The Income Tax Act, 2004 came into effect in July 2004. This act restructured the income tax system in line with modern requirements and repealed the previous Income Tax Act, 1973. Tax is levied on income from employment, income from business and income from investment. Taxable persons include entities and individuals. An entity can be a corporation or a trust and a corporation is loosely defined to mean any incorporated or unincorporated body of persons or association. For partnerships the individuals within the partnership are taxed on their share of the income. Taxation is on worldwide income for residents (or for individuals, of residents of more than two years) while taxation of non-residents is on Tanzanian source income only. The corporate tax rate is 30%. The individual tax threshold is Tsh 960,000 per annum, and the rates are from 18.5% to a top rate of 30%. Various provisional and final withholding taxes are applied to easy the collection of tax.

Moreverer, Tanzania offers a well-balanced and competitive package of fiscal trade incentives especially in the priority sectors such as manufacturing, agriculture, tourism, petroleum, gas and mining. For all these sectors, except petroleum and gas sectors, acquisition of all capital goods and parts are zero rated for import duty purposes and VAT thereon deferred.  Research expenses for agriculture are allowable for income tax purposes, while capital acquisitions are 100% expensed. You can also import duty-free all capital goods, spare parts, hotel facilities, explosive material for gas and oil exploration. Tanzania has also signed double taxation treaties with Denmark, India, Italy, Norway, Sweden, Kenya, Uganda, Zambia and Finland.

Source: Government Portal Content Committee, Last Reviewed on : 2015-10-05 16:07:58
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