Overriding of tax laws

We are an entity relying on a certain treaty for our affairs in Tanzania. Unfortunately, when the Tax Administration Act was enacted, there are certain provisions in this Act that contradict what is in the treaty. When such a conflict arises, what should one do? Moreover, we also intend to enter into a certain transaction whose tax consequences we are unsure of based on our reading of both the treaty and local laws. How should we proceed?
TY, Dar

The Tax Administration Act has a special provision in Part II of the Act under section 7 that addresses this specific issue and states that the provisions of an international agreement which the United Republic is a party shall, to the extent that the provisions of the agreement are inconsistent with the provisions of any tax law, prevail over the provisions of the tax laws.

This section defines ‘international agreement’ as a a treaty or other agreement which the United Republic signed with a foreign Government for the purpose of providing reciprocal assistance for the administration or enforcement of tax laws. Hence to the extent that there is indeed an inconsistency, the treaty that you are relying on will prevail. However, considering that the Act does not define the word treaty and you have not disclosed the name of the treaty, we strongly recommend you consult your tax advisor for further guidance.

Now to the second part of your question. Considering you are unsure of the tax consequences of this proposed transaction, we recommend you apply to the Commissioner General under section 11 to know the tax consequences in advance in what is called a private ruling

Section 11 states the following: the Commissioner General may, on application in writing by a person, issue a private ruling or a class ruling setting out position on the application of a tax law to an arrangement proposed or entered into- (a) in the case of a private ruling, by that person; or (b) in the case of a class ruling, by persons in a specified class. (2) A private or class ruling may apply to multiple arrangements or multiple tax laws. The ruling is binding- (a) if prior to its issue, the applicant makes- (i) full and true disclosure of all aspects of the arrangement to which the ruling applies to the Commissioner General; and (ii) the arrangement proceeds in all material respects as described in the application for the ruling; (b) if it clearly states in its heading to be a private ruling or class ruling; and (c) from date of issue for the period specified in the ruling.

Having said the above, the Commissioner General may refuse an application for a private or class ruling if- (a) in the case of a private ruling- (i) the arrangement has already been the subject of a tax decision; or (ii) the Commissioner General has commenced an investigation of the applicant’s tax affairs that covers the arrangement or, before the application, has notified the applicant in writing of an intention to do so; (b) the Commissioner General is of the opinion that an existing practice note adequately covers the arrangement; (c) the application is frivolous or vexatious; (d) the arrangement has not been carried out and there are reasonable grounds to believe that it will not be carried out; (e) the applicant has not provided the Commissioner General with sufficient information to make a ruling; or (f) in the opinion of the Commissioner General, it would be unreasonable to comply with the application having regard to the resources needed to comply and any other matters the Commissioner General considers relevant.

We strongly encourage you to make an application for a private ruling as that will provide certainty to you.

Mental health care support

It has been more than two months since my son has been revealing abject mental disorders. He keeps on chanting all day long and sometimes throws stones to people passing our neighbourhood and has occasioned losses to us and our neighbours. A doctor advised me to admit my son to a mental health centre at Mirembe in Dodoma for treatment. While planning to take my son to the health centre, my friend told me that I have to undergo a process before I could get my son admitted. Please guide me.
JS, Kilosa

We are sorry to hear this about your son. The procedure for admitting mentally disordered persons into such a mental health facility is well elaborated in the Mental Health Act, 2008. Before reception of your son into such a health medical centre, you are required to file a petition for a reception order either in the Resident Magistrate’s Court or the District Court. These two Courts have a concurrent jurisdiction in matters relating to mentally disordered persons.

The format for the petition is provided under the Second Schedule to the Act. Apart from the generic demographic particulars, the petitioner is required to disclose the first time when the patient showed signs of unsoundness of mind, age on first attack, whether previously the patient happened to be under care and treatment, supposed cause, whether suicidal, whether suffering from mental illness, behavioural disorders/mental disability, whether dangerous to others and in what way, whether he is capable of looking after himself, with whom he has been living, whether the patient is addicted to the use of any drug or intoxicant and whether any near relative (stating the relationship) has been afflicted with mental disorder/illness.

A mental health care facility shall, where it receives a petition for a reception order, conduct an immediate inquiry on behalf of the Court and shall cause two copies of medical certificates as prescribed in the Second Schedule to be issued by an approved medical officer, and an approved mental health practitioner. The copies of medical certificates shall be submitted to the Court within 48 hours from the day of issue.

Where the Court is satisfied that the person is mentally disordered and is a proper person to be admitted, it shall make and record a finding to that effect and make an order for the admission of that person to the mental health care facility. Your attorney or social welfare officers can guide you further.