Courtesy of:
His Excellence President
John Pombe Magufuli
Important business sectors:
- Mining (Gold, Diamonds, Tanzanite, Iron Ore, Coal, Uranium, etc.)
- Oil and Gas
- Tourism
- Agriculture
- Real Estates
Starting A Business In Tanzania.
Tanzanian businesses can be registered as a business name, a local company or a foreign company.
Registering Business In Tanzania
Business Registrations and Licensing Agency (BRELA) is responsible for business registration in Tanzania. BRELA issues certificates of compliance for foreign companies, certificates of incorporation for local companies and certificates of registration for sole proprietorships. Depending on nature of business, firms must thereafter
- Register their businesses with the Tanzania Revenue Authority (TRA),
- Register with one of the social security schemes in Tanzania
- Obtain business licenses.
Obtaining Business Licence For A Local Company
Schedule ‘A’ companies obtain their business license from the Ministry of Industry and Trade.
Schedule ‘B’ companies obtain their business license from the Municipality where the business premises are located.
Tanzania Investment Centre (TIC)
Starting a Company Through TIC’s One Stop Shop
Investors who wish to apply for incentives and are not yet incorporated may create a company through the one stop shop at Tanzania Investment Centre (TIC) provided that their investment projects are worth at least 500,000 USD for foreigners and 100,000 USD for Tanzanian Nationals.
Registering a Foreign Company
According to Tanzania company law, a foreign company is a company that is registered/incorporated outside Tanzania. It may conduct business in Tanzania by opening a branch in Tanzania. A foreign company can also be a company that has been incorporated in Tanzania but with majority shareholding (51%) being owned by a foreigner.
Trading Across Borders
The Customs and Excise Department administers all taxes on international trade. The taxes include Import Duty, Excise Duty and Value Added Tax (VAT) on imports.
Import Duty is a tax levied on imported goods. The duty is usually calculated as an ad-valorem rate on C.I.F value of goods imported into the country, and is collected before goods leave the entry point into the country and/or bonded warehouses.
Excise Duty is levied on certain consumer goods on importation. The traditionally excisable goods are goods whose consumption is seen by the society as immoral i.e. beer and cigarettes, and goods whose consumption creates negative externalities to the society i.e. petroleum. In Tanzania apart from the traditional excisable goods soft drinks and motor vehicles are excisable for revenue generation purposes.
It is also charged on specific or ad-valorem rate, and the tax base for the ad-valorem rate is the C.I.F value plus the import duty.
Importing Goods Into Tanzania
Before importing goods into Tanzania, importers are advised to liaise with relevant government agencies for approval depending on nature of goods imported. These government agencies include
- Ministry of Agriculture,
- The Government Chemist,
- The Tanzania Food and Drug Authority,
- The Ministry of Livestock and Fisheries Development,
- Ministry of Natural Resources and Tourism,
- Tanzania Bureau of Standards,
- Tanzania Atomic Energy Commission,
- The Fare Competition Commission.
Obtaining certificate of incentives
Incentives can be both fiscal and non fiscal.
Fiscal incentives include:
- Import duty and VAT exemption on project capital/deemed capital goods
- Import Duty Draw Back Scheme.
Non-fiscal incentives include:
- Immigration quota of up to 5 people,
- Guaranteed transfer of net profits or dividends of the investment,
- Payment in respect of foreign loans, remittance of proceeds net of all taxes and other obligations,
- Royalty fees and other charges,
- Payment of emolument and other benefits to foreign personnel.
Special incentives are provided to strategic investors with projects of over US$ 20 million that offer specific/great impact to the society or economy.
Extension of Certificate of Incentives
Investors can obtain Certificate of Incentives in two phases. Validity of the Certificate of Incentives in the first phase is three (3) years. The Investor may choose to apply for three (3) years at once or apply for one year or two years, depending on the nature of the business. In case after three years (3) the Investor still needs incentives he/she may apply for an extension of Certificate of Incentives. In this phase the investor is given a maximum of two years incentive, divided into one year each.