Tanzania scraps fees on electronic transactions

Wednesday September 21 2022
Tanzania's Finance and Planning Minister Mwigulu Nchemba.

Tanzania's Finance and Planning Minister Mwigulu Nchemba. PHOTO | FILE


Tanzania on Tuesday backtracked on implementing levies on electronic transactions, which took effect on August 15, following a public outcry.

The levies will be done away with on October 1, Finance and Planning Minister Mwigulu Nchemba told Parliament.

“The amendments made are to cancel the levies for transferring money from banks to mobile networks (and vice versa) and to cancel levies for transferring money within the same bank,” he said.

The government will scrap the fee for transferring money from one bank to another, and also waive the transaction fee on withdrawal of cash through bank agents and ATMs for values not exceeding Tsh30,000 ($12.81), Dr Nchemba said.

“We discussed and reviewed a number of issues including reducing tax and levies’ burden on the people, encourage the use of cash transactions, simplifying tax collection, and avoid double taxation for both parties – that’s the sender and receiver,” he said.

Dr Nchemba further noted that the government is looking to reduce its expenditure—by slashing spending on things such as conferences, training, refreshments, and trips—to cover the revenue it will forego from the cancelled levies.


“The Government expected to collect approximately Tsh500 billion ($213.51 million) from mobile and bank transactions levies,” he said.

Data from the Tanzania Communication Regulatory Authority (TCRA) shows that in a span of 12 months, value of transactions declined by 2.5 percent in 2021, to Tsh36,570 ($15.62) per person per transaction from Tsh37,495 ($16.15) recorded in 2020.