Taxation is the process or means by which the sovereignty through its lawmaking body, raise

income to defray the necessary expenses of the government. Taxation is based on the reciprocal
and duties of protection and support between the government and its people. The most common
basis or factors used by tax legal systems to tax persons in their jurisdiction are Citizenship or
Nationality, Domicile, Country of source and country of Destination and Residence.

Taxation basically divided into two purpose which is primary purpose and secondary purpose.
According to the primary purpose of taxation is to provide funds or property with which to
promote the general welfare of its citizens and to enable it to finance its multifarious activities
and in secondary purposes is to strengthen anemic enterprises by giving tax exceptions, to
protect local industries against foreign competition through imposing of high customs duties on
imported goods, to prevent inflation by increasing taxes or ward off depression by decreasing
taxes also to reduce inequalities in wealth and income by imposing progressively higher taxes.
According to the question the following here are the laws governing the taxation in Tanzania and
how they have address taxation

THE INCOME TAX ACT [CAP 332 R.E 2019]1

Taxation of income in Tanzania is effected under the Income Tax Act 2004 as amended from
time to time. (Income Tax Act Cap. 332 R.E 2019) according to Tanzania this law governs the
income tax such as personal income tax, cooperate tax and withholding tax. This law helps to
ensure the structured approach to collecting income taxes broadening the tax base, preventing tax
evasion by clearly defining taxable income and outlining compliance requirements. Here is how
the income tax act address taxation in Tanzania.

By Imposition of Income Tax under section 4 provide Income tax is applied to individuals,
businesses, and other entities, by Chargeable Income under Section 6 it Defines taxable income
types, such as income from jobs, businesses, investments, and capital gains, Through Exempt
Income under Section 7 Lists income types not taxed, like some pensions, charity income, and
certain international organization earnings, By Employment Income under Section 9 it
Describes what counts as employment income, including salaries, wages, bonuses, and

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The Income Tax Act [Cap 332 R.E 2019]

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allowances, by Business Income under Section 19 Defines business income, including profits
from trade, business, or professional activities, by Deductions Allowed under Section 23, it
Specifies deductions that reduce taxable income, like business expenses and loan interest. By
Withholding Tax under Section 35 it Covers withholding tax, which is deducted directly from
payments like interest, dividends, and royalties, by Filing of Returns under Section 66 Requires
individuals and companies to file annual tax returns, with guidelines on the process and
deadlines, by Record Keeping under Section 80 Requires taxpayers to keep accurate records of
income and expenses, By Offenses and Penalties under Section 88 it Sets penalties for tax
violations, such as late payments or tax evasion, and also it provide Powers of TRA under
Section 104 thus it Grants the TRA authority to enforce tax laws, conduct audits, and collect
taxes.

THE TAX ADMINISTRATION ACT [CAP. 438 R.E 2019]2

The Tax Administration Act, was enacted to unify and streamline the administration of taxes
under a single legal framework. Prior to this act, Tanzania’s tax administration was regulated by
multiple, fragmented laws for different types of taxes, which made the system complex, less
efficient, and harder for taxpayers to understand. The purpose of this act is to provide an
overarching frame work for tax administration, ensuring that tax laws are implemented fairly and
effectively.

Here is how the tax administration act address taxation in Tanzania, through Taxpayer
Registration it provided under Section 12 “Requires individuals and businesses to register with
TRA and get a TIN to be recognized in the tax system”, By Filing Returns provided under Section
22 provide that “Taxpayers must submit accurate returns by set deadlines, reporting income and
tax owed”. Tax Assessments TRA can calculate taxes owed based on returns or their own
estimates if returns are missing or incomplete”, by Record Keeping it provided under Section 36
“Taxpayers must keep financial records for five years for TRA verification”, by Dispute
Resolution provided under section 47 thus Taxpayers can dispute assessments, starting with TRA
and escalating to the Tax Revenue Appeals Board if needed, By Penalties under Section 58 it
“Sets penalties for late filing, inaccurate declarations, or poor record-keeping. Enforcement”
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The Tax Administration Act [Cap. 438 R.E 2019]

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also under Section 73 TRA can enforce payment, including freezing bank accounts or seizing
assets if necessary.
THE VALUE ADDED TAX ACT [CAP 148 R.E 2019]3
this act establishes the legal framework that cover all vatable sales of goods, property, services or
leases of property by vat tax payers also the law establishes the framework for value added tax
that an indirect tax applied to goods and services.
According to section 5 states that VAT is imposed on every taxable supply of goods and services
in Tanzania and on imports. This section establishes VAT as a broad-based consumption tax,
making it clear that it applies to all stages of production and distribution for taxable items.
Taxable Goods and Services VAT is charged on most goods and services supplied in Tanzania,
as well as on imported goods and services. Some essential goods and services may be exempt or
zero-rated to reduce the tax burden on consumers, VAT Rates, the standard VAT rate in
Tanzania is 18%, applied to most taxable supplies. Some goods and services, like exports, are
zero-rated, meaning they are taxable at a 0% rate, VAT Registration the Businesses with a
turnover above a certain threshold are required to register for VAT, ensuring that only significant
businesses participate in VAT collection and remittance. VAT Filing and Payment: Registered
businesses must collect VAT from customers and remit it to the Tanzania Revenue Authority
(TRA). They are required to file regular VAT returns and pay the tax owed on time, Input VAT
Credits Businesses can deduct VAT paid on inputs (goods or services they purchase for their
business) from the VAT they owe on sales, preventing double taxation and reducing tax costs for
businesses.
THE EXCISE (MANAGEMENT AND TARIFF) ACT [CAP 147 R.E 2019]4
This law regulates excise duties on specific goods and services, such as alcohol, tobacco and fuel
in order to generate revenue and discourage certain consumption behaviors.
The Scope of this law It applies to goods produced within Tanzania and certain imported items.
This law addresses the taxation through Registration that the Businesses producing or dealing
with excisable goods must register with the Tanzania Revenue Authority (TRA), by Tariffs It
Excise rates that are specified in schedules attached to the Act, outlining how much tax applies to
each product category, through Compliance The Act requires businesses to keep records of
excisable goods, and allowing TRA to monitor and enforce tax compliance and also Penalties
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The Value Added Tax Act [Cap 148 R.E 2019]
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The Excise (Management and Tariff) Act [Cap 147 R.E 2019]

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such as Fines and penalties are imposed for non-compliance, such as failure to pay excise tax or
attempting tax evasion.

BIBLIOGRAPHY
 BOOKS

Oxford Dictionary of Law. Edited by Jonathan Law, 2009, Oxford University Press. Oxford
Reference Online, [Https://Www.Oxfordreference.Com].

 STATUTES

The Income Tax Act [Cap 332 R.E 2019]

The Excise (Management and Tariff) Act [Cap 147 R.E 2019]