Tanzania Finance Bill 2026

On 15 June 2026 the government tabled the Finance Bill 2026 which proposes numerous changes. Please see below summary of some of the key proposed changes from the Bill.

Bank of Tanzania Act Cap 197 RE 2023

1. Reduce interest rate for Bank of Tanzania (BOT) advances to the government to 14% from 18% of the budgeted domestic revenues of government (section 35).
2. BoT may grant temporary advances to the government in the events of an “unforeseeable or unavoidable event” which causes a temporary deficiency of revenue (section 69(1)).
3. New section 69(3) provides list of unforeseeable / unavoidable events:
   • disaster as defined in the Disaster Management Act;
   • external economic event, circumstance or cause of exceptional magnitude and impact; and
   • state of emergency.

Electronic Transactions Act Cap 442 RE 2023

1. New section 13(2) – Minister for Finance may, by order published in the Gazette, prescribe payments which shall be made through electronic means.  
2. New section 13(3) – proof of electronic payment made under section 13(2) shall be used by the relevant authority as mandatory requirement for the approval of applications relating to the transfer of assets, including land, buildings, and motor vehicles.

Excise Duty (Management and Tariff) Act Cap 147 R.E 2023

1. Shift from a one-time 3 year adjustment to an annual excise duty adjustment (section 126(3)).
2. Introduction:
   1. 20% for Artificial flowers, foliage, fruits and similar imported products classified.
   2. 5% on the value of bets has been introduced across all gambling platforms.
   3. Applicable rate (7%, 10% or 17%) excisable services provided by non-resident suppliers through online platforms (B2C) without physical presence in Tanzania.
   4. 10% for Imported ultraviolet/light-emitting diodes (UV/LED) gel nail curing machines used for manicure or pedicure.
   5. section 126(9) – imported vehicles:
      1. 20% for motor vehicles aged 8 years but not more than 10 years.
      2. 40% for motor vehicles aged more than 10 years but not more than 20 years.
      3. 50% for motor vehicles aged more than 20 years.

Income Tax Act Cap 332 RE 2023

1. Reduction of profit deemed distributed to 15%, from 30%.
2. Exclusion of:
   • companies registered on the Dar es Salaam Stock Market;
   • financial institutions as defined under the Banking and Financial Institutions Act;
   • insurance companies,; and
   • mining companies that have Framework Agreements with government (section 33A).
3. Imposition of withholding tax on payments for food crops, livestock products or fishery product at a rate rate provided for under paragraph 4(d) of the First Schedule (section 109A(1)). 
4. Increase of digital service tax to 3% from 2% (section 116(1)). 
5. New section 116A – payment of 2% capital gain tax of the gross payment on sale of forest produce.
6. New section 116B – payment of 1% capital gain tax of the value of the food crop. 
7. New section 169A – recognition of tax benefit given under a Framework Agreements executed before 1 July 2026 for Mining Licence and Special Mining Licence holders which will be based on Cabinet approval, removing the requirement for Government Notices.
8. 12-month holiday for newly registered small scale taxpayers with revenue of less than TZS 4 million under the presumptive regime.

Mining Act Cap 123 RE 2023

1. New section 149A – introduction of Mineral Survey Fund whose source of revenue shall be 10% of the revenues collected from royalties, fees and other charges.

Stamp Duty Act Cap 189 RE 2023

1. Expansion of definition of “lease” to include documents of exchange of moveable property (section 72).
2. New proposed stamp duty rates for:
   • Bills of Exchange;
   • Partnership Deeds;
   • Bills of Sale (security);
   • Cheques;
   • Surrender of Lease Documents;
   • Transfer of Agricultural Land.

Tax Administration Act Cap 438 RE 2023

1. Amendment of section 54 – electronic disclosure of persons contracted, or subcontractors engaged in construction and extractive industry to the Commissioner General within 30 days.
2. Amendment of section 73(4) – power to the Commissioner General to sell seized perishable goods by way of auction or private treaty.

Tax Revenue Appeals Act Cap 408 RE 2023

1. Amendment of section 23(8) – extension of the statutory period for out-of-court amicable settlement of tax disputes to 90 days, from 60 days.
2. 90 days period is effective from the date the TRAB or TRAT issues an order permitting alternative dispute resolution (ADR).

Value Added Tax Act Cap 148 RE 2023

1. Amendment section 5 – rate payable to a taxable person supplying goods shall be 15% and to taxable person supplying service shall be 12%.
2. Withholding agent shall within 10 days after the end of each tax period, pay to the Commissioner any VAT that has been withheld (section 71(5)).
3. Introduction of a mandatory 30-day VAT refund timeline with interest on delay from the date of the notice.  
   • VAT refunds must be paid within 30 days of application with taxpayers legally entitled to interest on delayed payments.  
   • The law previously provided for 90 days to merely issue a refund decision (section 88(3)).
4. New VAT exemptions:
   1. Equipment for electric vehicle charging stations.
   2. Import of LPG smart meters by a distributor.
   3. Turbojets, turbo-propellers, other gas turbines and aircraft tyres.
   4. Paper for printing airline boarding passes.
   5. Dairy packaging materials – locally produced and imported.
   6. Polyester fibres for fishing net production.
   7. Clothes and garments produced from locally grown cotton from 1 July 2026 to 30 June 2027.

Please contact VELMA Law if you have any comments or questions.