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SADC Member States

CHAPTER 2 - INDIRECT TAXES

A. Value Added Tax/Sales Tax (National Goverment)

1. Name of Tax, Levied in Terms of Which Act (Name, Number and Year)

Value Added Tax, Value Added Tax Act (VAT), CAP 148, 1997

2. Department Responsible for Administration

Domestic Revenue Department / Large Taxpayers Department

3. Taxpayer

VAT is paid by the final consumer of goods and services but collected in stages from the suppliers of such goods or services. In Tanzania suppliers who collect VAT and pass is on to the Government are described as Registered Traders.

VAT is levied on all supplies made by registered trader in the course of or furtherance of their businesses.

Registered trader means any person who is or is required to be registered for VAT (Section 19).

Any person whose taxable turnover exceeds, or the person has reason to believe will exceed the turnover prescribed in regulation shall make application to be registered within 30 days of becoming liable to make such application.

The registration threshold is

Tshs 20,000,000/(about US$20,000 : June 2002) in consecutive 12 months; or
Tshs 5,000,000/ for 3 consecutive months

4. Time When Tax is Levied

Levied when:

At the "time of supply" - i.e. whichever is the earlier of:

Importation when custms duty levied. (Section 6)

Goods are removed from the premises of the supplier or from other premises where the goods are
under his/her control to the person to whom they supplied.

Tax invoice is issued in respect of the supply.

Payment is received for all or part of the supply.

Services is rendered or performed.

5. Included in Tax Base

Any supply of goods or services in Tanzania Mainland where it is taxable supply made by a taxable person in the course of or in furtherace of any business carried on by him. (section 4)
The importation of taxable goods or services from any place outside Mainland Tanzania (section 4)

6. Positive Rates

The Act provides for one positive rate

Standard rate of 18% (section ?)

7. List of Goods/Services at Zero Rate

The following goods and services are subject to VAT at the Zero rate (1st Schedule).

- Exportation of goods and services from the United Republic of Tanzania.

- The supply of goods; including food and beverage for consumption or duty free sale on aircraft or ships on journey to destination outside the United Republic of Tanzania.

- The supply which comprise the transport of or any source ancillary to transport or amended law loading, unloading, wharfage, shore handling, storage, ware housing and handling supply in connection with goods in transit through the United Republic of Tanzania whether such services are supplied directly or through an agent to a person who is not a resident of the United Republic of Tanzania.

- The supply of services which comprises the handling, parking, pilotage, salvage or towage of any foreign going ship or aircraft while in Tanzania Mainland.

- The supply of services which comprises the repair, maintenance, insuring, broking or management of any foreign on going ship or aircraft.

- The supply of agricultural produce intended for export by co-operative unions and community based societies with the Tanzania Revenue Authority.

- The supply by a local manufacturer of human medicines, drugs and equipments upon the recommendation of the Pharmacy Board.

Notes:
Zero rating implies that VAT at 0% is levied on these supplies when made by a Registered Trader (effectively VAT at 0% on outputs) and consequently that any VAT charged to the Registered Trader (on inputs) for the purpose of making such supplies, may be claimed as an input tax credit.

Similarly, as 0% is a rate of tax, supplies made at 0% are taxable supplies and even where all the supplies made are at 0%, the supplier is subject to the requirements to register for VAT.

8. List of Goods/Services at Positive Rates Other Than Standard

Not applicable for Tanzania Revenue Authority

9. List of Exemptions

The following goods and services are exempted from VAT. (2nd Schedule)

- Food crops and livestock supplies.
- Pesticides fertilizers.
- Health supplies.
- Educational supplies.
- Veterinary supplies.
- Books and newspapers.
- Transport services.
- Housing and land.
- Finance and insurance.
- Water.
- Funeral services.
- Aviation spirit.
- Agricultural implements.
- Tourist services and Tourist Charter Services.
- Postal supplies.
- Aircraft.
- Fishing Gear.
- Game of Chance.
- Computer.
- Yarn.
- The supply of packing material to the registered milk processor or manufacture.

Notes:
An exemption implies that no VAT is levied on these supplies when made by a Registered Trader (exempt outputs) and consequently, that any VAT charged to the Registered Trader (on inputs) for the purpose of making such supplies, may not be claimed as an input tax credit.

Similarly, as exempt supplies are not taxable supplies, where a supplier makes only exempt supplies that supplier is not allowed or subject to the requirements to register.

10. Tax Period

Section 26.

Every registered trader shall lodge a tax return, in a form approved by the Commissioner.

The Prescribed accounting period for registered trader shall be the Calendar month containing the effective date of registration and each calendar month after that.

The return shall be lodged by the last working day of the month after the end of the prescribed accounting period to which it relates, or within such other time as the Commissioner may in a particular case determine by notice in writing.

(every business on monthly returns)

11. Deferement Schemes/Special Schemes

Deferments are made for importation or purchases of capital goods, by a person registered or not registered for VAT. (s 19)

A special scheme for Retailer is in place. (that enables retailers to calculate and account for the output tax collected by retailer (regulation 14 empowered by s68)

12. Beneficiary of Revenue

National Government

B. Excise Taxes Alcohol (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise Duty, The Excise Tariff Ordinance (Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority: Customs and Excise Department, Domestic Revenue Department and Large Taxpayers Department

3. Taxpayer

Importer / Local manufacturer

4. Included in Tax Base

Excise duty - specific is levied on both locally manufactured alcohols as well as their imported equivalents. The products include beer, wines and spirits (s14)

5. Tax Rate (Tariff Heading, Description, Rate Per Litre or Per Litre of Absolute Alcohol)

The following are Excise duties for the 2001/2002 financial year:

(per litre of product)
(two rates for wine) one for local (TShs 350.00) and one for imported (Tshs 708.00)
(also what about sherry, sparkling wine, ciders, fruit beverages, "alco pops" traditional beer?)
These items all lie under the tariff heading 2204 (s14)

TARIFF HEADING DESCRIPTION QUANTITY DUTY (TSHS)

1. 2203 Beer made from malt 1 Litre 220.50
2. 2204 Wines from fresh grapes 1 Litre 350.00 and 708.00
3. 2208 Spirits 1 Litre 1050.00

6. Rebates

As alcohol products are mainly used for human consumption and not as intermediate inputs. For revenue purposes therefore, there are no allowances for rebates.

Yes! There is no rebate for medical/industrial use of alcohol.

7. Beneficiary of Revenue

National Government

C. Excise Taxes Tobacco Products (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise duty (on tobacco products), The Excise Tariff Ordinance ( Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority Customs and Excise Department Large Taxpayers Department and Value Added Tax Department

3. Taxpayer

Importer / Local manufacturer

4. Included in Tax Base

Excise duty is levied in certain locally manufactured goods and imported tobacco products.
Most products here, apart from cigars, attract specific duty (s14)

Cigars attract ad valorem rate of 30%.

5. Tax Rate (Tariff Heading, Description, Rate Per Kilogramme, or Per 10 cigarettes/Cigars)

The following are Excise duties as of June 2002:

(s14)

TARIFF HEADING DESCRIPTION QUANTITY DUTY (TSHS)

1. 2402 Cigarettes (at B above is cigar and not cigarettes)
Not exceeding 70mm 1,000 sticks 3,601.50
70mm or more 1,000 sticks 8,495.50
other 1,000 sticks 15,435.00

2. 2403 Smoking tobacco Kg 7,794.00

6. Rebates

There are no rebates

7. Beneficiary of Revenue

National Government

D. Excise Taxes Fuel/Hydrocarbon Oils (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise duty on hydrocarbon oils - The Excise Tariff Ordinance (Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority Customs and Excise Department

3. Taxpayer

Importer

4. Included in Tax Base

The specific tax (excise duty) is levied on imported petroleum products for home consumption (s14)

The excise duty on petroleum is imposed on almost all (hydrocarbon oil) products (s14)

5. Tax Rate (Rate of Duty Per Litre, Total Tax Burden as a Percentage of Retail Price)

Summary:

Item
Excise duty
(TShs per litre)
Fuel levy
(TShs per litre)
VAT
Total tax
(TShs per litre)
Retail price - D'Salaam
(TShs per litre)
Total Tax Burden
(per litre)

Petrol
146.00
80.00
20%
271.20
590.00
45.9%

Diesel
201.00
80.00
20%
337.20
549.00
61.4%

The detailed rates are as follows:

The applicable excise duty rates on petroleum products (2001/02) are:

Motor Spirit (MSP) ................................................... TShs. 146.00 per litre
Motor Spirit (MSR) ................................................... TShs. 137.00 per litre
Jet Fuel (JET A1) ..................................................... TShs. 56.00 per litre
Illuminating Fuel (IK) .............................................. TShs. 122.00 per litre
Diesel Oil (IDO) ...................................................... TShs. 201.00 per litre
Gas Oil (GO) ........................................................... TShs. 127.00 per litre
Furnace Oil (Fuel Oil) .............................................. TShs. 26.50 per litre
Residual Oils .......................................................... TShs. 35.00 per kg LPG ........................................................................ TShs. 228.00 per kg
Petroleum gases in gaseous state ........................ TShs. 12.00 per kg
Lubricating Oils ...................................................... TShs. 500.00 per m3
Lubricating greases ............................................... TShs. 0.75 per kg

6. Rebates/Concessions/Special Schemes

There is no rebate scheme. (Yes, nothing for industrial or agricultural use) Special scheme for mining industry where excise duty is paid on purchases then refunded back as a claim.

7. Beneficiary of Revenue

National Government

E. Excise Taxes - Non Alcoholic Bevarages/Other (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise duty on non-alcoholic beverages, The Excise Tariff Ordinance ( Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority Customs and Excise Department / Value Added Tax Department and Large Taxpayer Department.

3. Taxpayer

Importer / Local manufacturer

4. Included in Tax Base

Excise duty is levied on locally manufactured goods as well as their imported equivalents.
The products included here are mineral water and soft drinks and they all attract specific rates (S15)

5. Tax Rate (Tariff Heading, Rate Per Litre, or Per Kilogramme, or Per Unit)

The Excise duties as of June 2002 are:

TARIFF HEADING DESCRIPTION QUANTITY DUTY (TSHS)

2201 Mineral water 1 Litre 35.70
2202 soft drinks 1 Litre 35.70

6. Rebates

None

7. Beneficiary of Revenue

National Government

F. Excise Duty on Luxury Goods - Ad Valorem (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise duty on luxury motor vehicles and cigars. The Excise Tariff Ordinance ( Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority: Customs and Excise Department / Value Added Tax Department and Large Taxpayers Department

3. Taxpayer

Importer / Local manufacturer

4. Included in Tax Base

Ad valorem is levied on non-utility motor vehicles (saloons and station wagons) with engine capacity exceeding 2000 cc (s15)

5. Tax Rate

The ad valorem rate as of June 2002 is:

Motor vehicles 10% of the CIF plus import duty value (s15)

6. Special Methods (to deal with the specific needs of some industries)

Currently there are no special methods to deal with specific needs.

7. Beneficiary of Revenue

National Government

G. Excise Duty on Other Goods (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

The Foreign Vehicle Transit Charges - Motor vehicle transit charges Act 19 of 1995
Motor Vehicle Transfer Tax - Motor Vehicle Tax Act 21 of 1972
Motor Vehicle Registration Tax - Motor Vehicle Tax Act 21 of 1972
Motor Vehicle Driving Licence - Road Traffic Act 30 of 1973
Foreign Motor Vehicle Permit - Road Traffic Act of 1973 section 7
Road Toll Levy - Road Tolls Act 13 of 1985, section 4
Business License Fees - Business License Act of 19 .. Section ..

2. Department Responsible for Administration

Domestic Revenue Department / Large Taxpayers Department

3. Taxpayer

The person having use of motor vehicle under a hiring or hire purchase agreement of the person in charge of the vehicle or the driver of the vehicle or the agent of the owner in relation to any business connected with the vehicle.

The person in charge of the vehicle.

Owner or person having charge of foreign vehicle (s3 (1) of Foreign vehicle transit charges Act 19 of 1995.

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Any person upon purchase of fuel as the case may be

The owner or driver of a vehicle bearing foreign registration upon purchasing a custom border post.

The owner or driver of a vehicle carrying fuel in bulk upon passing a customs border post for use in Mainland Tanzania. (s2 of Road Tolls Act 13 of 1985)

--------------------------------------

A person applying for registration upon the date on which such application for first registration is made. (s5 of the Motor vehicle tax Act 21 of 1972)

--------------------------------------

Any person who pays the business licence fee in respect of businesses described in the first schedule of the Act (s8 (1) of the Business Licensing Act 25 of 1972)

4. Included in Tax Base

All foreign transit vehicles passing through the entry point along a public road for the whole of the distance to be covered by the vehicle while in the Country (s3 (2) of Foreign vehicle transit charges Act 19 of 1995)

The transfer of motor vehicles that takes place in the country (s3(3) of Foreign vehicle transit charges Act 19 of 1995)

The first registration of any motor vehicle to which the Act applies or where in the case of any motor vehicle to which this act applies registration tax has not been paid by reason of an exemption under sesction 6 upon the expiry of such exemption or upon transfer of such motor vehicle to a person not enjoying similar exemption (s4 and 9 of Motor vehicles Taxes Act 21 of 1972)

Holder of the valid driving licence or a valid learner driving licence issue to him in respect of the class of motor vehicle or trailer (s21 of Road Traffic Act of 1973)

Holders of foreign motor vehicle permits (s3(1) Motor vehicle transit charges Act 19 of 1995)

All business other than those mentioned in the Act (s5 of the Business Licensing Act 25 of 1072)

5. Tax Rate (specify ad valorem or specific)

Up to but not exceeding 3 axles - US$6 or its equivalent in convertible currency for every 100 kilometres (Schedule under s3(3) of Foreign vehicle transit charges Act 19 of 1995)

Exceeding 3 axles - US$16 or its equivalent in convertible currency for every 100 kilometres (Schedule under s3 (3) of foreign vehicle transit charges Act 19 of 1995)

For Transfer of motor vehicle - TShs 500,000/= and motorcycle TShs 15,000/= plus alteration fee of TShs 5,000/= for each. (s8 of the Motor Vehicles Taxes Act 21 of 1972)

For registration of motor vehicle - TShs 90,000/= and motor cycle 27,000/= and registration card TShs 5,000/= for each. (s4 of the Motor Vehicles Taxes Act 21 of 1972)

For acquiring a driving license: License fees TShs 10,000/= renewable every three years and provisional licence fees TShs 5,000/= also renewable every three months (s21 of Road Traffic Act of 1973)

US$20 for every 30 days (charged from foreign motor vehicles that enter into the country with foreign registration numbers) (s6(1) of the foreign vehicle transit charges Act 19 of 1950)

The fees for business licensing vary in respect of the 37 business categories ranging from TShs 10,000/= to TShs 1,000,000/= (s6 of Business Licensing Fee Act 25 of 1972).

6. Special Methods (to deal with the specific needs of some industries)

The Minister may, in case of need, issue exemptions for public inteest (s 3(4) Foreign vehicle transit charges Act 19 of 1995, s6 of the Motor Vehicles Taxes Act 21 of 1972, s5 of Road Traffic Act 30 of 1973 and s5 of the Business Licensing Act 25 of 1972)

The beneficiaries include the Public as whole including military, government, diplomats and others.

7. Beneficiary of Revenue

National Government

H. Air Passenger Duty/ Departure Tax (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Airport service charges, Airport service charges Act 26 of 1962.
Port service charges, Port Service charges Act 11 of 1973

2. Department Responsible for Administration

(Tanzania Revenue Authority Value Added Tax Department

The tax is collected by operators and agents (those acting on behalf of operators) whom are required to then pay it to Value Added Tax Department

3. Taxpayer

Passengers on Local and International Flights (Section 7 of Airport service charges Act 26 of 1962)

Passengers on every occasions on which he embarks on a ship at a port in Tanganyika for a journey outside the United Republic (Section 3 (1) of Port Service charges Act No 11 of 1973)

4. Included in Tax Base

Tax is levied on:

Any passenger embarking on an aircraft at an airport within the United Republic of Tanzania who intends to travel to a destination outside the United Republic shall, whether or not a resident of Tanzania, (domestic internal flights are also subjected to the charges though at lower rates) (s7 of Airport Service charges Act 26 of 1962)

Any passenger embarking on a ship/speed boat, but not members of the crew of the ship concerned, or of another ship owned, operated or managed the ship concerned, when on duty (is this for international or domestic or both) this applies to any passenger who embarks on a ship at a port in Tanganyika for a journey outside the United Republic (sections 2 and 3 of Port Service charges Act No 11 of 1973)

5. Tax Rate

In Airport TShs 5000/= for resident and U$D 30 or it’s equivalent in convertible currency in
any other case for foreigner. (s3)

In Port TShs 500/= for resident and U$D 5 or it’s equivalent in convertible currency
for foreigner.

6. Exemptions

The following were exempted from airport service charges:

Any child under the age of two years.

Any passenger embarking at an airport/ port at which he/she is in transit.
(Section 4 of Airport service charges Act 26 of 1962 for Airport passengers. And section 4 (1) of Port Service charges Act No 11 of 1973 for Port passengers)

For Airport passengers only

An embarked passenger who paid the charge but returns back to the airport without landing at any airport. (s4 (2)

An embarked passenger on an aircraft with accommodation of not more than five passengers where no payment for consideration for the passenger's carriage has been made (s4 (3))

The Minister may, by order published in the Gazette, exempt any class of persons from the liability for the charge (s5(1))

(Any others e.g. crew (mentioned above) military personnel, diplomats, passenger ferry transport etc etc - They are not exempted)

7. Beneficiary of Revenue

National Government

I. Financial Transaction Taxes/Stamp Duty (National Government)

1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year

Stamp duty, Stamp duty Act 20 of 1972

2. Department Responsible for Administration

Domestic Revenue Department / Large Taxpayers Department

3. Taxpayer

Normally, the holder of the stamp duty instruments and small businesses (Non-Vat agents) (s5(1))

4. Included in Tax Base

Every instrument specified in the schedule (Stamp Duty on Instruments' Schedule) to the Stamp duty act but not being an Instrument in respect of which an exemption is provided for in the Act or in the schedule:

(e.g. could you summarise the main ones ...)
Examples

1. Composition of duty on receipts
2. Acknowledgement of a debt
3. Administration Bond etc

AND

which is executed in Tanganyika (Mainland Tanzania) or if executed outside Tanganyika, related to any property in Tanganyika or to any matter or thing to be performed or done in Tanganyika (S5)

5. Tax Rate

Stamp duty is levied at the rates indicated below:

- Composition agreement 1.2% (of sales exceeding 1,000,000 per annum, but imposed on monthly basis at that rate) (section.9)

Others - every instrument has got it's own rate as specified in the schedule to the Act
(e.g. could you summarise the main ones)

Examples
1. Acknowledgement of a debt:
i. Of an amount not exceeding TShs 99.99, no stamp duty paid
ii. Of an amount exceeding TShs 99.99 but not exceeding TShs 500, TShs 5 for each TShs 500 or part
thereof is paid as stamp duty.
iii. Of an amount exceeding TShs 500, Stamp duty of TShs 40 for each TShs 1,000 or part thereof not
exceeding the minimum of TShs 200 is paid.
2. Administration Bond:
i. Where the amount is less than TShs 1,000, no stamp duty paid
ii. Where the amount is less than TShs 1,000 or more, Stamp duty of TShs 40 for each TShs 1,000 or
part thereof not exceeding the minimum of TShs 200 is paid.

6. Exemptions

Specific exemptions are normally issued by the Minister (s15)

The Minister may, by notice in the Gazette exempt any chargeable instrument, or any category, class or description of such instruments. General exemptions are stipulated in the schedule of instruments to the Act. This is a Ministerial discretion depending upon circumstances and therefore not indicated in the Act.

7. Beneficiary of Revenue

National Government

J. Payroll Taxes/Social Security Taxes (National Government)

1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year

No longer applicable in Tanzania (Refer to Chapter 1, N (Other Central Government) (1))

2. Department Responsible for Administration

3. Taxpayer

4. Included in Tax Base

5. Tax Rate

6. Exemptions

7. Beneficiary of Revenue

K. Other Taxes (National Government)

1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year

- The foreign vehicle Transit charge, Motor vehicle transit charge Act 19 of 1995.

- Motor vehicle transfer tax, Motor vehicle tax Act 21 of 1972.

- Motor vehicle registration tax, Motor vehicle tax Act 21 of 1972.

- Motor vehicle driving licence, Road Traffic Act of 1973 section 19.

- Foreign motor vehicle permit, Road Traffic Act of 1973 section 7.

2. Department Responsible for Administration

Domestic Revenue Department / Large Taxpayers Department

3. Taxpayer

- The person having use of motor vehicle under a hiring or hire purchase agreement of the
person in charge of the vehicle or the driver of the vehicle or nay person holds himself out
as, or the agent of the owner in relation to any business connected with the vehicle.
- The person in charge of the vehicle.
- The person in charge of the vehicle.
- No person shall drive any class of motor vehicle, on a road unless he/she is the holder of a
valid driving licence or a valid learner driving licence issue to him in respect of such class of
motor vehicle.
- Owner or person having charge of foreign vehicle.

4. Included in Tax Base

- There shall be levied and paid in accordance with the rates prescribed in the schedule to this Act, the transit charges in respect of a vehicle passing through the entry point along a public road for the whole of the distance to be covered by the vehicle while in the Country

- This shall be charged, levied and collected at the rate specified in the second schedule to this Act, upon the transfer of any motor vehicle. No tax on transfer shall be payable upon the transfer of a motor vehicle by the owner to his/her spouse; upon the transfer of motor vehicle to the personal representative of deceased owner; where a motor vehicle is registered jointly in the name of two or more persona as owners, upon the transfer by any one of them of his interest therein to any other of them; upon the transfer of motor vehicle to the trustee in bankruptcy of the owner; upon the transfer of motor vehicle by any body cooperate to any other body cooperate which is an associate of such first name body cooperate, in the course of the transfer of all the assets of such body cooperate to such associate body cooperate.

- Shall be charged, levied and collected upon first registration of any motor vehicle to which this Act applies or where in the case of any motor vehicle to which this act applies registration tax has not been paid by reason of an exemption under section .6 upon the expiry of such exemption or upon transfer of such motor vehicle to a person not enjoying similar exemption.

- No person who owns or who has charge of a motor vehicle or trailer of any category shall allow or permit any person to drive such motor vehicle unless such person is the holder of the valid driving licence or a valid learner driving licence issue to him in respect of that class of motor vehicle or trailer.

- Ever permit shall be valid for a period of thirty days from the date when the motor vehicle first entered Mainland Tanzania. No permit under these rules shall be granted in respect of the same vehicle more than once in any calendar year

5. Tax Rate

o Up to but not exceed axle 3 – U$D 6 or its equivalent in convertible currency for every 100
kilometres .
Exceeding axle 3 – U$D 16 or its equivalent in convertible currency for every100 kilometres.

o For Transfer of motor vehicle TShs 50,000/= and motor cycle TShs 15,000/= plus alteration fee of
TShs 5,000/= for each.

o For registration of motor vehicle TShs 90,000/= and motor cycle 27,000/= and registration card TShs
5,000/= for each.

o Licence fees TShs 10,000/= renewable every three years and provisional licence fees TShs 5,000/=
also renewable every three months.

o U$D 20 for every 30 days.

6. Exemptions/Rebates/Deferments/Special Schemes

The minister may, if in his opinion it is in the public interest do so.

7. Beneficiary of Revenue

National Government

L. Other Taxes 2 (National Government)

1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year

2. Department Responsible for Administration

3. Taxpayer

4. Included in Tax Base

5. Tax Rate

6. Exemptions/Rebates/Deferments/Special Schemes

7. Beneficiary of Revenue

Disclaimer:

SADC Member States

CHAPTER 2 - INDIRECT TAXES

A. Value Added Tax/Sales Tax (National Goverment)

1. Name of Tax, Levied in Terms of Which Act (Name, Number and Year)

Value Added Tax, Value Added Tax Act (VAT), CAP 148, 1997

2. Department Responsible for Administration

Domestic Revenue Department / Large Taxpayers Department

3. Taxpayer

4. Time When Tax is Levied

Levied when:

At the "time of supply" - i.e. whichever is the earlier of:

Importation when custms duty levied. (Section 6)

Goods are removed from the premises of the supplier or from other premises where the goods are
under his/her control to the person to whom they supplied.

Tax invoice is issued in respect of the supply.

Payment is received for all or part of the supply.

Services is rendered or performed.

5. Included in Tax Base

6. Positive Rates

The Act provides for one positive rate

Standard rate of 18% (section ?)

7. List of Goods/Services at Zero Rate

8. List of Goods/Services at Positive Rates Other Than Standard

Not applicable for Tanzania Revenue Authority

9. List of Exemptions

10. Tax Period

Section 26.

Every registered trader shall lodge a tax return, in a form approved by the Commissioner.

The Prescribed accounting period for registered trader shall be the Calendar month containing the effective date of registration and each calendar month after that.

11. Deferement Schemes/Special Schemes

Deferments are made for importation or purchases of capital goods, by a person registered or not registered for VAT. (s 19)

A special scheme for Retailer is in place. (that enables retailers to calculate and account for the output tax collected by retailer (regulation 14 empowered by s68)

12. Beneficiary of Revenue

National Government

B. Excise Taxes Alcohol (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise Duty, The Excise Tariff Ordinance (Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority: Customs and Excise Department, Domestic Revenue Department and Large Taxpayers Department

3. Taxpayer

Importer / Local manufacturer

4. Included in Tax Base

Excise duty - specific is levied on both locally manufactured alcohols as well as their imported equivalents. The products include beer, wines and spirits (s14)

5. Tax Rate (Tariff Heading, Description, Rate Per Litre or Per Litre of Absolute Alcohol)

6. Rebates

7. Beneficiary of Revenue

National Government

C. Excise Taxes Tobacco Products (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise duty (on tobacco products), The Excise Tariff Ordinance ( Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority Customs and Excise Department Large Taxpayers Department and Value Added Tax Department

3. Taxpayer

Importer / Local manufacturer

4. Included in Tax Base

Excise duty is levied in certain locally manufactured goods and imported tobacco products.
Most products here, apart from cigars, attract specific duty (s14)

Cigars attract ad valorem rate of 30%.

5. Tax Rate (Tariff Heading, Description, Rate Per Kilogramme, or Per 10 cigarettes/Cigars)

6. Rebates

There are no rebates

7. Beneficiary of Revenue

National Government

D. Excise Taxes Fuel/Hydrocarbon Oils (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise duty on hydrocarbon oils - The Excise Tariff Ordinance (Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority Customs and Excise Department

3. Taxpayer

Importer

4. Included in Tax Base

The specific tax (excise duty) is levied on imported petroleum products for home consumption (s14)

The excise duty on petroleum is imposed on almost all (hydrocarbon oil) products (s14)

5. Tax Rate (Rate of Duty Per Litre, Total Tax Burden as a Percentage of Retail Price)

6. Rebates/Concessions/Special Schemes

There is no rebate scheme. (Yes, nothing for industrial or agricultural use) Special scheme for mining industry where excise duty is paid on purchases then refunded back as a claim.

7. Beneficiary of Revenue

National Government

E. Excise Taxes - Non Alcoholic Bevarages/Other (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise duty on non-alcoholic beverages, The Excise Tariff Ordinance ( Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority Customs and Excise Department / Value Added Tax Department and Large Taxpayer Department.

3. Taxpayer

Importer / Local manufacturer

4. Included in Tax Base

Excise duty is levied on locally manufactured goods as well as their imported equivalents.
The products included here are mineral water and soft drinks and they all attract specific rates (S15)

5. Tax Rate (Tariff Heading, Rate Per Litre, or Per Kilogramme, or Per Unit)

The Excise duties as of June 2002 are:

TARIFF HEADING DESCRIPTION QUANTITY DUTY (TSHS)

2201 Mineral water 1 Litre 35.70
2202 soft drinks 1 Litre 35.70

6. Rebates

None

7. Beneficiary of Revenue

National Government

F. Excise Duty on Luxury Goods - Ad Valorem (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Excise duty on luxury motor vehicles and cigars. The Excise Tariff Ordinance ( Cap.332)

2. Department Responsible for Administration

Tanzania Revenue Authority: Customs and Excise Department / Value Added Tax Department and Large Taxpayers Department

3. Taxpayer

Importer / Local manufacturer

4. Included in Tax Base

Ad valorem is levied on non-utility motor vehicles (saloons and station wagons) with engine capacity exceeding 2000 cc (s15)

5. Tax Rate

The ad valorem rate as of June 2002 is:

Motor vehicles 10% of the CIF plus import duty value (s15)

6. Special Methods (to deal with the specific needs of some industries)

Currently there are no special methods to deal with specific needs.

7. Beneficiary of Revenue

National Government

G. Excise Duty on Other Goods (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

2. Department Responsible for Administration

Domestic Revenue Department / Large Taxpayers Department

3. Taxpayer

4. Included in Tax Base

The transfer of motor vehicles that takes place in the country (s3(3) of Foreign vehicle transit charges Act 19 of 1995)

Holder of the valid driving licence or a valid learner driving licence issue to him in respect of the class of motor vehicle or trailer (s21 of Road Traffic Act of 1973)

Holders of foreign motor vehicle permits (s3(1) Motor vehicle transit charges Act 19 of 1995)

All business other than those mentioned in the Act (s5 of the Business Licensing Act 25 of 1072)

5. Tax Rate (specify ad valorem or specific)

Up to but not exceeding 3 axles - US$6 or its equivalent in convertible currency for every 100 kilometres (Schedule under s3(3) of Foreign vehicle transit charges Act 19 of 1995)

Exceeding 3 axles - US$16 or its equivalent in convertible currency for every 100 kilometres (Schedule under s3 (3) of foreign vehicle transit charges Act 19 of 1995)

For Transfer of motor vehicle - TShs 500,000/= and motorcycle TShs 15,000/= plus alteration fee of TShs 5,000/= for each. (s8 of the Motor Vehicles Taxes Act 21 of 1972)

For registration of motor vehicle - TShs 90,000/= and motor cycle 27,000/= and registration card TShs 5,000/= for each. (s4 of the Motor Vehicles Taxes Act 21 of 1972)

For acquiring a driving license: License fees TShs 10,000/= renewable every three years and provisional licence fees TShs 5,000/= also renewable every three months (s21 of Road Traffic Act of 1973)

US$20 for every 30 days (charged from foreign motor vehicles that enter into the country with foreign registration numbers) (s6(1) of the foreign vehicle transit charges Act 19 of 1950)

The fees for business licensing vary in respect of the 37 business categories ranging from TShs 10,000/= to TShs 1,000,000/= (s6 of Business Licensing Fee Act 25 of 1972).

6. Special Methods (to deal with the specific needs of some industries)

7. Beneficiary of Revenue

National Government

H. Air Passenger Duty/ Departure Tax (National Government)

1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)

Airport service charges, Airport service charges Act 26 of 1962.
Port service charges, Port Service charges Act 11 of 1973

2. Department Responsible for Administration

3. Taxpayer

4. Included in Tax Base

Tax is levied on:

5. Tax Rate

In Airport TShs 5000/= for resident and U$D 30 or it’s equivalent in convertible currency in
any other case for foreigner. (s3)

In Port TShs 500/= for resident and U$D 5 or it’s equivalent in convertible currency
for foreigner.

6. Exemptions

The following were exempted from airport service charges:

Any child under the age of two years.

An embarked passenger who paid the charge but returns back to the airport without landing at any airport. (s4 (2)

An embarked passenger on an aircraft with accommodation of not more than five passengers where no payment for consideration for the passenger's carriage has been made (s4 (3))

7. Beneficiary of Revenue

National Government

I. Financial Transaction Taxes/Stamp Duty (National Government)

1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year

Stamp duty, Stamp duty Act 20 of 1972

2. Department Responsible for Administration

Domestic Revenue Department / Large Taxpayers Department

3. Taxpayer

Normally, the holder of the stamp duty instruments and small businesses (Non-Vat agents) (s5(1))

4. Included in Tax Base

5. Tax Rate

6. Exemptions

7. Beneficiary of Revenue

National Government

J. Payroll Taxes/Social Security Taxes (National Government)

1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year

No longer applicable in Tanzania (Refer to Chapter 1, N (Other Central Government) (1))