Tax The main taxes applicable to Tanzanian companies are as follows: Corporation Tax
Approximate cost (USD equivalent)
Class
Item
A
Investors and self employed
1,000
B
Non-Citizens in possession of prescribed professions
500
For non-residents (e.g. businesses in Tanzania for less than 120 days)
For residents (e.g. a subsidiary company)
C
Non-Citizens in possession of other professions Non-Citizens employed or engaged in approved religious and charitable activities
1,000
Class
D
500
On a company's total income
30%
30%
On a company with 3 years of perpetual unrelieved losses On a newly listed company on the Dar es Salaam Stock Exchange On a branch office's total income
0.3% of annual turnover
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Gratis (Free)
E
Refugees
Once the application for a work permit has been accepted by the Labour Commissioner, the applicant must then apply for a residence permit. The applicant must lodge application form TIF1, along with the required supporting documentation, to the Commissioner General of Immigration. The applicable fees for residence permits vary on the type of work the applicant will carry out, but are between USD 200 - USD 3000. Amongst other regulations, employer and employee relations in Tanzania are regulated by the Employment and Labour Relations Act, 2004. Under Tanzanian law, an employer can terminate an employment contract if there are fair and valid reasons and in accordance with fair procedures. Reasons that may justify a termination of an employment contract in Tanzania include misconduct, incapacity, incompatibility and operational requirements (retrenchment). There are strict procedures that must be complied with prior to and after the termination of an employment contract. Accordingly, an employee may challenge their termination if the employer did not comply with the prescribed procedures. In practice, an aggrieved employee would refer a claim to the Commission for Mediation and Arbitration. The law sets a minimum compensation for unfair termination of an employment to be an amount equivalent to twelve months of an employee’s salary.
25%
25%
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30%
On a branch office's repatriated income
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10%
Withholding Tax
For non-residents (e.g. businesses in Tanzania for less than 120 days)
For non- residents
For residents (e.g. a subsidiary company)
(e.g. businesses in Tanzania for less than 120 days)
On dividends from companies listed on the Dar es Salaam Stock Exchange
5%
5%
On dividends from other companies
10%
10%
On management and technical service fees (e.g. mining, oil and gas)
5%
15%
On cross-border transport
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5%
On a company's directors' fees
15%
15%
Value Added Tax VAT is charged at a rate of 18% on the supply and import of goods and services. No VAT is charged on the export of goods and certain services from Tanzania. A number of taxable supplies and goods are exempted from VAT under the VAT Act, 2014.
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