The Finance Act, 2022: Key Amendments

The Finance Act, 2022 – Key Amendments The Finance Act of 2022 was published on 30th June 2022 and it came into force from 1 July 2022. It amends a number of laws and the key amendments include: Partnership & Trusts to make disclosures on beneficial owners. Beneficial owner definition to match the definition under Anti-Money Laundering Act. Failure to keep a register of members and beneficial owners now penalized at Usd$ 60 to Usd$500. Liquidators to now keep records of dissolution for not less than 10 years from date of dissolution. There is introduction of decoder subscription fees – modality for collection to be prescribed. EWURA to now to enforce standards for goods and services. Beneficial owner threshold fixed at 5%. Collective management of copyright established.

Copyright levy imposed at a rate of 1.5% to be chargeable on the value of radio or TV set enabling recording, analogue audio or video recorders. All complaints against the collective management of copyright to be handled by COSOTA. Tanzania Bureau of Standards (TBS) mandated to regulate all dairy activities in Tanzania. The term business re-defined to cover all transactions/ activity carried out through the internet or conducted in the digital market place. Digital market place defined to mean a platform which enables direct interaction between buyers and sellers. A resident person, other than partnership, who does business in Tanzania mainland and Zanzibar may claim tax credit for the year of income.

A nonresident person receiving payment from Tanzania from an individual other than payment made in respect of services rendered through digital market shall pay income tax on that month in a single instalment equal to 2% of gross payment. Also, the said nonresident shall file a monthly return on or before 7th day of the month. Now mandatory to have insurance cover if one operates a public market, commercial building, marine vessel, ferry or pantoon. Land rent arrears interest reduced from 1% to 0.5% per month on outstanding amount until paid. If due for more than 12 months, interest shall be 1% monthly. Minister may exempt whole or part of interest accrued from land rent arrears. Each district and urban center authority shall now establish one-stop center for coordinating, encouraging, promoting and facilitating business within its area of jurisdiction.

Royalty for gold sold at refinery centers fixed at 4% and royalty for coal used as industrial raw material fixed at 1%. The term equity under the Income Tax Act re-defined to mean paid up share capital at the end of the year of income. OSHA to issue compliance certificate not later than seven (7) days upon fulfilling’s the requirements. Fiscal incentives under the Tanzania Investment Act shall be granted in accordance with the applicable law as opposed to the previous provision which allowed the Minister of Finance alone to issue such fiscal incentives. TASAC given exclusive mandate to regulate all clearing and forwarding functions in Tanzania of arm, ammunitions, minerals concentrates, chemical used by mining companies and government trophies.

All citizen’s at age of 18 who have the National Identification Number by NIDA shall be issued with a Tax Identification Number (TIN) with effect from 01st January, 2023. Tax consultants to be licensed by the Commissioner General – unlicensed consultants cannot provide tax advisory or assistance services.

TRA’s Commissioner General mandated to register all storage facilities in Tanzania. On approval by Cabinet, the special strategic investments approved by the National Investment Steering Committee under the Tanzania Investment Act may get an exemption from paying value added tax. Disclaimer The views expressed in this paper are those of the author only and should not be considered as an official interpretation, defamatory or interference of any legislation, laws or policies of any country including Tanzania. The contents of this paper should not under any circumstances be reproduced or used without our express written consent. It should not be considered as a legal advice to any of its recipient(s) and should not be relied upon without obtaining further legal advice. We accept no liability for any loss occasioned or suffered due to the contents of this paper.