Critical Amendments of Tanzania Laws: Finance Act, 2024

The Finance Act, 2024 came into force on 1 July 2024 and it amends various tax and non-tax laws. We have highlighted the key amendments as follows:

1. Microfinance Act, CAP 407

The Finance Act 2024 (Finance Act) has amended section 4(3)(a) of the Microfinance Act to permit microfinance service providers to receive returns or profits on deposits or borrowing. The underlined words are the new addition.

2. Mining Act, CAP 123

The Finance Act amends the Mining Act as follows:

a) Value addition in Tanzania: Section 59 has been replaced which now requires mineral right holders or licensed dealers other than those with existing agreements with the Government that provide otherwise, to set aside an amount of gold for processing, smelting, refining, and trading in Tanzania at the percentage as the Minister of Minerals may determine. This amount will not be less than 20%.

b) Royalties: Section 87 is amended by adding royalty payable as follows: in the case of gold sold to the Bank of Tanzania, of four per centum. Further, section 87 has a new sub-section added which provides: One-third of the royalty payable to the Government in respect of gold or gemstone shall be paid by depositing refined gold or gemstone equivalent to the ascertained royalty into the National Gold and Gemstone Reserve.

c) Section 90A: is amended to exclude payment of clearance fee for the gold sold to the Bank of Tanzania.

3. Land Act, CAP 113

The Land Act is amended by the Finance Act as follows:

The Collection and Distribution of Land Rent: The Land Act has been amended to allocate 20% of the collected land rent to be deposited in the local government authority’s account maintained at the BOT, to facilitate collection and recovery activities.

4. Bank of Tanzania Act, CAP 197

The Bank of Tanzania Act is amended by the Finance Act as follows:

Section 26 has a new subsection that provides as follows: Save as otherwise prescribed by the Minister in the regulations, a person who transacts using any other currencies other than the legal tender issued by the Bank commits an offense.

5. Banking and Financial Institution Act, CAP 342

The BFIA is amended to provide for how the Bank of Tanzania shall dispose of all abandoned properties. The amendments provide that, the Bank of Tanzania shall dispose of the abandoned properties surrendered to it by a bank or financial institution, in the following manner; 90% of the abandoned properties shall be submitted to the consolidated fund; and 10% of the remaining abandoned properties shall be deposited in the general reserve fund maintained by the Bank of Tanzania. These provisions shall come into operation on 1 January 2025.

6. Tanzania Investment Regulations, GN 83 of 2024

On 9 February 2024, the Minister of State President’s Office Planning and Investment issued the Tanzania Investment (Amendment) Regulations 2024 which allowed a person or investor to appeal to the Minister responsible for investment if such investor or person is aggrieved by the decision of the Tanzania Investment Centre (TIC).

The Finance Act has now added a new sub-regulation which allows a person or investor dissatisfied with the Minister's decision to seek remedies in court. Before this amendment, the decision of the Minister was final.

7. National Industries (Licensing and Registration) Act, (Cap 46)

The Finance Act amends the above-mentioned law as follows:

A person who holds a license under this Act or is granted a certificate by the Tanzania Investment Centre and is granted the following benefits shall enter into a performance agreement with the Minister for Finance: Exemption or zero rate under the VAT Act, duty remission under the East African Community Customs Management Act; or a stay of application of the East African Community Common External Tariff. The Minister of Finance will make regulations for its proper implementation.

Please note that this Updater does not address all the amendments passed by the Finance Act.

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 the express written consent of the Author. It should not be considered as 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. The information contained herein is general and is not intended to address the circumstances of any particular deal. Although effort has been made to research and share the correct information, we do not provide any guarantee to such information.