The Finance Act 2023 has come into effect on 1 July 2023.
It includes various changes, notably to Section 56 Income Tax Act so that a change of underlying ownership under Section 56 will not occur where the change:
- is a result of allotment of new membership interest of the entity; or
- is a sole result of transfer of membership interest of a resident entity to another resident person.
It seems this seeks to address concerns on the application of Section 56 to pure investment situations and to the possible double taxation of the transfer of shares in a Tanzanian company.
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