Investment Promotion and Incentives The Tanzania Investment Centre ( TIC ) is a quasi- governmental body which is the driving force behind the promotion and practical implementation of investment in Tanzania. The primary function of the TIC is to “coordinate, promote and facilitate investment in Tanzania and to advise the Government on investment policy”. The TIC is a “one-stop-shop” for investment facilitation, providing investors with proactive responses to their needs. This includes the power to grant certificates of incentives to certain investors (excluding those in the mining and upstream oil and gas sectors, which are governed by tailored legal frameworks) where the value of an investment from a foreign company or foreign owned company is greater than USD 500,000. Such investors are entitled to certain fiscal and non-fiscal incentives and exemptions which would not otherwise be available to them in Tanzania, including, amongst other things, tax incentives, assistance in obtaining permits, licences, visas etc. This support for investors continues throughout the investment process; the TIC will assist investors to overcome administrative and regulatory hurdles, as well as providing an aftercare service once the investment is established. The TIC also guarantees against misappropriation and allows a foreign investor to hold a derivative title to land (the highest form of title to land a foreign investor may hold). The fiscal investment regime is very stable and predictable, displaying an understanding of the needs of an investor and the importance of investment to stimulate economic growth. The Tanzania Investment Act 1997 (the TIA ) has the primary objective of making the tax structure more transparent and less complicated. Investors enjoy incentives in the form of enhanced capital deductions and allowances. The incentives include but are not limited to: • investment allowance on capital expenditure; • infrastructure allowance on infrastructure expenditure; • preferential tax rates for withholding tax on dividends; • royalties and interests; • preferential tax rates on personal income tax and indirect tax; and • double deductions on approved costs and expenses. As Tanzania is a member of the East African Community, investors are able to reap the non-fiscal benefits from the
East African Community Customs Management Act 2004. Provided goods meet particular requirements in relation to their origin, the movement of goods to other member states is zero rated for value added tax and there are no other general taxes. Tanzania has legislation in place which allows certain incorporated in Tanzania with at least 80% of their output for export and annual export turnover of at least USD 500,000 for foreign investors to be granted a developers’, operators’ or service providers’ licences allowing them to operate in the EPZ. Companies operating within EPZs are eligible for additional fiscal and non-fiscal incentives and reliefs not otherwise available to companies operating in Tanzania, including amongst other things, tax and customs incentives. Employment/Immigration Foreign individuals are prohibited from engaging in any occupation in Tanzania unless they have a valid work permit and residence permit for the position of employment. It is also prohibited for any person to employ any foreign individual, or cause them to be employed, if that foreign individual does not have a valid work permit and residence permit or an exemption from the requirement to have either permit. The Government of Tanzania updated the legislation in relation to work permits for foreign nationals working in Tanzania by introducing the Non-Citizens (Employment Regulations) Act, 2015 (the Non-Citizens Act ) and making several changes to the Immigration Act, 1995. Certain foreign nationals that are entering Tanzania to attend meetings or conferences may acquire a business visa at the border. Business visas may be single or multiple- entry and are valid for 90 days. Under the new legislation, foreign nationals who wish to work in Tanzania must obtain both a work permit and a residence permit. The current form of work permit was introduced under the Non-Citizens Act for foreign nationals working in Tanzania and is issued for a maximum period of 2 years (albeit the work permit can be renewed up to a total duration of 5 years). An applicant must lodge application form TFN 901, along with the required supporting documentation, to the Labour Commissioner. The fees for the permits are as follows: discrete areas of land to be designated as Export Processing Zones ( EPZs ). This allows companies
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