Finance Act 2024: Changes that affect your business in Tanzania starting 1 July 2024

SRA

Summary of the Finance Act 2024

The Finance Act 2024 brings significant changes across various sectors, impacting taxes, duties, levies, and the management of public revenues. Below is a detailed summary of the key amendments introduced in the Act:

Part I: Preliminary Provisions

  • The Act is officially cited as the Finance Act, 2024, and comes into effect on July 1, 2024.

Part II: Banking and Financial Institutions Act (Cap. 342)

  • Amendment of interest terms to include “interest, profit, or return.”
  • Procedures for handling abandoned properties by the Bank of Tanzania, with 90% directed to the Consolidated Fund and 10% to the General Reserve Fund.

Part III: Bank of Tanzania Act (Cap. 197)

  • Transactions in currencies other than the legal tender are considered an offense unless specified otherwise.
  • Inclusion of “return or profit” alongside interest rates in several sections.

Part IV: Budget Act (Cap. 439)

  • New sources for the Contingency Fund include windfall fuel tolls and a portion of the railway development levy.

Part V: Cashewnut Industry Act (Cap. 203)

  • Export levy collected is to be fully remitted to the Cashewnut Board for five years starting July 1, 2024.

Part VI: Excise (Management and Tariff) Act (Cap. 147)

  • New excise duty regulations for service providers of commercial advertisements on betting, gaming, or lotteries.
  • Provisions for remission of excise duty on specific raw materials used in manufacturing other excisable goods.

Part VII: Export Tax Act (Cap. 196)

  • Introduction of a 10% export tax on crude sunflower oil and sunflower seeds.

Part VIII: Gaming Act (Cap. 41)

  • Dealers’ certificates for gaming activities and the use of chips or tokens in slot machines are now mandated.

Part IX: Imports Control Act (Cap. 276)

  • Introduction of the Industrial Development Levy on specified goods, excluding those originating from East African Community Partner States.

Part X: Income Tax Act (Cap. 332)

  • Inclusion of digital assets and content in taxable assets.
  • Introduction of withholding tax for payments to digital content creators and owners of digital assets.

Part XI: Land Act (Cap. 113)

  • 20% of collected land rents to be deposited in local government authorities’ accounts to aid in rent collection and recovery.

Part XII: Local Government Authorities (Rating) Act (Cap. 289)

  • 20% of collected rates to be directly deposited in local government authorities’ accounts.

Part XIII: Local Government Finance Act (Cap. 290)

  • Flexibility in loan issuance when specific groups do not apply for loans.

Part XIV: Microfinance Act (Cap. 407)

  • Amendments include the terms “return or profit” in relation to interest on loans.

Part XV: Mining Act (Cap. 123)

  • Requirements for gold processing, smelting, refining, and trading within Tanzania.
  • Introduction of royalties on gold sold to the Bank of Tanzania.

Part XVI: Motor Vehicle (Tax on Registration and Transfer) Act (Cap. 124)

  • Revised registration tax for electric and hybrid motor vehicles.

Part XVII: National Industries (Licensing and Registration) Act (Cap. 46)

  • Industries benefiting from certain tax exemptions or duty remissions must enter performance agreements.

Part XVIII: National Parks Act (Cap. 282)

  • Collection and distribution of park fees to be handled by the Tanzania Revenue Authority.

Part XIX: Ngorongoro Conservation Area Act (Cap. 284)

  • Similar fee collection and distribution procedures as the National Parks Act.

Part XX: Plant Health Act (Cap. 133)

  • Collection and distribution of fees for inspection services on plant products.

Part XXI: Ports Act (Cap. 166)

  • Wharfage revenue to be deposited in the Tanzania Ports Authority’s account at the Bank of Tanzania.

Part XXII: Railways Act (Cap. 170)

  • Increased levy rates and procedures for the collection and distribution of levies.

Part XXIII: Road and Fuel Tolls Act (Cap. 220)

  • Windfall fuel toll collections to be used exclusively for road infrastructure maintenance.

Part XXIV: Universal Health Insurance Act (Cap. 161)

  • Inclusion of treatment for pregnant women and children under five in health insurance coverage.

Part XXV: Sugar Industry Act (Cap. 251)

  • Establishment of production cost assessments and declarations of sugar distributors.

Part XXVI: Tax Administration Act (Cap. 438)

  • Introduction of compliance obligations for cargo consolidators.

Part XXVII: Tax Revenue Appeals Act (Cap. 408)

  • Procedures for settling tax appeals amicably within specified timelines.

Part XXVIII: Value Added Tax Act (Cap. 148)

  • Amendments to definitions and conditions for zero-rated supplies, including gold to the Bank of Tanzania and licensed refineries.

Part XXIX: Vocational Education and Training Act (Cap. 82)

  • VAT exemptions on payments to casual laborers by water supply and sanitation authorities.

Part XXX: Wildlife Conservation Act (Cap. 283)

  • Designation and handling of funds collected for wildlife conservation.

For a more detailed analysis of how these changes might impact your business or personal finances, consider reaching out to S R Auditors for professional advisory services. Our expertise can help you navigate the complexities of the new legislation and ensure compliance while optimizing your tax strategy.

 

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The information provided in this website is for general informational purposes only and should not be construed as legal, financial, or professional tax advice. While we strive to ensure the accuracy and relevance of the content, we do not warrant or guarantee the completeness, reliability, or suitability of the information for any purpose. Readers are advised to consult with a qualified tax professional or legal advisor before making any decisions or taking any actions based on the information presented in this article. We disclaim any liability for any loss or damage incurred as a result of reliance on the content provided herein.

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