The government is considering extending the tax holiday enjoyed by home‑grown start‑ups to give local investors and entrepreneurs a competitive advantage over foreign counterparts. Deputy Minister of Finance and Planning Hamad Hassan Chande agreed with a proposal from Special Seats MP Ng’wasi Damas Kamani that the Investment Law empowers the revenue authorities to award a five‑year tax holiday to foreign investors, while remaining silent on local investors.
According to the legislator, the Financial Act of 2019 allows the Tanzania Revenue Authority (TRA) to grant a six‑month tax holiday to start‑ups, but implementation of the legislation has been lacking. “I suggest that the government amend the Investment Law and the financial legislation to extend the tax holiday for new businesses to a period of 12 to 18 months,” Kamani said. The deputy minister seconded the suggestion, adding, “We will work on this new proposal at the government level.”
During the question session in the National Assembly in Dodoma on Tuesday, Mr. Chande directed TRA Commissioner General Alphayo Kidata to ensure full implementation of the Financial Act of 2019. “We want the Revenue Authority to respect the legislation,” he said, responding to concerns that new business owners, especially entrepreneurs, were being required to pay tax upfront contrary to the law. The financial law permits new start‑ups to enjoy a tax exemption of at least six months.
Legislators also highlighted that local councils require new business owners to produce tax clearance before issuing business licences. “This tax clearance comes after the assessment is done, yet entrepreneurs are required to pay a substantial amount before the clearance is printed,” Ms. Kamani told the Assembly.
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