As a business owner in Tanzania, staying updated with tax regulations is crucial for compliance and financial planning. The Tanzania Revenue Authority (TRA) frequently updates tax policies to align with economic goals and improve tax administration. Below are the key tax updates for 2025 that every business should know.
1. Introduction of the Digital Services Tax (DST)
In response to the growing digital economy, Tanzania has introduced a Digital Services Tax. This tax targets foreign and local digital service providers offering platforms, apps, or online services used in Tanzania.
- Who is affected? Digital platforms, including e-commerce sites, content streaming services, and online marketplaces.
- Compliance requirements: Businesses must register for DST with the TRA and file monthly returns.
2. Updated Corporate Income Tax Rates for SMEs
To support Small and Medium Enterprises (SMEs), the government has revised corporate income tax brackets:
- Businesses with annual turnover below TZS 50 million now enjoy reduced tax rates or exemptions.
- Enhanced filing support has been introduced for SMEs through TRA’s online portal.
3. Mandatory Use of Electronic Fiscal Devices (EFDs)
Starting January 2025, the use of EFDs is mandatory for all businesses, regardless of size.
- Penalties: Non-compliance attracts fines starting at TZS 500,000 or legal action.
- Benefits: EFDs streamline tax reporting and improve transparency.
4. Value-Added Tax (VAT) Amendments
Significant changes to VAT include:
- Threshold Adjustment: The VAT registration threshold has been increased to TZS 200 million in annual taxable supplies.
- Exemptions: Additional goods in the agricultural and renewable energy sectors have been added to the VAT exemption list.
5. Increased Focus on Withholding Taxes
The TRA is enhancing enforcement of withholding taxes across industries, including:
- Consultancy and professional services: Subject to a 5% withholding tax.
- Rental income: Revised withholding rates apply to commercial property rentals.
6. Enhanced Taxpayer Support Services
To make compliance easier:
- The TRA has launched a mobile app for filing returns and making payments.
- Training sessions are being organized to educate businesses about the latest updates.
How Kenosis.co.tz Can Help
At Kenosis.co.tz, we understand the importance of compliance in maintaining a successful business. Our web hosting services can help you stay organized by providing tools for record-keeping, tax calculations, and online platforms to connect with the TRA.
Stay ahead of the curve and ensure your business complies with all tax regulations. For more updates, subscribe to our newsletter or contact us for assistance with setting up online systems to simplify your tax processes.
Contact Us Today to learn more!