Legal Update – 5 July 2021

Finance Act 2021

60 second overview

A quick executive snapshot of what the Finance Act 2021 amends:

Companies Act

  • Share warrants not to be issued
  • All share warrants issued to be cancelled within 12 months

Electronic and Postal Communications Act

  • Introduces development levy on airtime
  • Levy between TZS 5 to 222.70
  • Regulations on how to collect and account for levy to be in place

Higher Education Student’s Loan Board Act

  • Relief for students
  • No retention fee, or any other fee, charges, penalty to be imposed without Ministerial approval

Income Tax Act

  • Permanent Establishment definition widened
  • Filing of withholding tax returns now monthly
  • Withholding tax exempted on interest on Government bonds of 3+ years

National Payment Systems Act

  • Money transfer levy introduced
  • Between TZS 10 to 10,000
  • Regulations to be issued

Non-Citizen’s (Employment Regulation) Act

  • Introduces a fine of TZS 500,000 per month, if expatriate return not filed timely twice a year

Public Audit Act

  • Specific and wider definition of a public authority or body that can be audited by CAG
  • May include corporate bodies under Companies Act

Stamp Duty Act

  • Stamp Duty on instruments schedule amended

Tax Administration Act

  • Tax Ombudsperson, office not established since 2015, now likely to be in place soon
  • Taxpayer primary data server required to be within Tanzania before July 2022
  • Notice to obtain information in writing expanded to include taxpayer in addition to any other person not liable to pay taxes
  • Tax deposit requirement of 1/3 of tax to object assessments remains intact
  • More powers given to CG to reduce interest or penalty
  • Introduces 100% penalty of the tax shortfall in controlled transactions if inconsistent with arms length principle
  • Impeding administration of a tax law now includes not maintaining a primary data server and not providing official translations of documents

Tax Revenue Appeals Act

  • Allows party to an appeal at any stage to mediate and resolve a tax dispute


  • Reciprocal arrangement on VAT between Zanzibar and Mainland Tanzania
  • Exemptions on VAT for mosquito nets, relief goods, NGOs amongst others

To read a copy of the Finance Act, click here.