History of taxation in tanzania pdf

Standard models of taxation and their conclusions must reflect these realities. Tanzania amends capital gains tax rules to include change. Tanzania amends capital gains tax rules to include change in control and single installment tax payment following the president of tanzania s assent of the finance bill, various amendments to the legislation came into effect on 19 october 2012. Putting aside the role of administrative issues in explaining the evolution of tax. In days of old the source of wealth was land and its proceeds. Tax avoidance and evasion are pervasive in all countries, and tax structures are undoubtedly skewed by this reality. This pattern continues through to today as nations are influenced by developments in tax. The thesis thus reports on the examination of property tax administration in ilala. The structure of the tanzanian tax system differs from other low income. Reforms that were done postcolonial era include introduction of sales tax in 1969, enacting of new income tax legislation in 1973, amendment of the existing tax legislation to revise the tax bases. Public finance is the term, which has traditionally been used or applied to the packages of those policy problems, which involve the use of tax. The tanzania registry procedure manual 2007 recognizes emails sent or. Background to taxation 1 introduction to taxation the evolution of taxation is attributed to the development of the modern state, which led to increased expenditure for infrastructure and public services.

Understanding media history in any society is in itself understanding a societys. Mafia island is administered from the mainland, while. Contents1 introduction and overview 1 2 the tax system in tanzania 22. Taxation, imposition of compulsory levies on individuals or entities by governments. A company is resident in tanzania if it is incorporated in tanzania, or its management and control was exercised in tanzania during the year of income, or it has a permanent domestic establishment in tanzania. The british empire tried to fight for economic dominance in the region. The main tax laws are to be read in conjunction in order to achieve the desired goal of the provisions. Income tax nonresidents are taxed on their tanzaniansourced income. An economic perspective on double tax treaties within.

The colonial period thin tanzania has dates back from 15 century when vasco da gama, the portuguese explorer visited the tanzanian coast island of zanzibar and later in the 16th century, the. Introduction to taxation our purposes, the sections on tax structure, types of tax, tax administration, and understating the tax law will be relatively. Fair taxation was a key issue for many english citizens during the medieval period. This reason above has made taxation to be an important part of the fiscal policy of any government and some autonomous or semiautonomous bodies have been established to oversee all issues pertaining to tax revenue collections. As discussed below and in chapter 8, s corporations retain many though not all of the benefits of the corporate form without the cost of double taxation. The purpose of this paper is to present some of the major moments in the history of real and personal property taxation. Some of the shona chiefs and their subjects refused new laws introduced by the colonial administration as well as the british technique of collecting taxes. Tanzania, east african country situated just south of the equator. The major loophole in the tax law is the area where companies exploit capital allowances on their qualified capital expenditure. May 12, 2015 intoduction to public finance and taxation theory. The interesting point which can be underscored is that at all times there was discussion about the correct taxation principles andor the just taxation system and that at no time. The mainland tanzania has a long history of functioning local government, starting with the native authorities ordinance in 1926. The case of kenya 2 executive summary the tax base in kenya, as in most subsaharan african countries, is extremely narrow.

Tax system of tanzania had evolved overtime to reflect socioeconomic and political situation at the time. Subscribe to tax notes today for all taxrelated topics. The concepts that evolved were transported to other empires and cultures where tax ideas took. This sourcebook has been written for the sole purposes of guiding students of tanzania tax law in the study of the income tax law in tanzania. Agriculture in tanzania probably began about 1,000 bc but the farmers still made wooden and stone tools. Taxes are levied in almost every country of the world, primarily to raise revenue for government expenditures, although they serve other purposes as well. However, samson 2002 indicated that the history of taxation can be. In 1964 nyerere reaches an agreement with abeid karume, president of the offshore island of zanzibar which has been so closely linked in its history to the mainland territory of tanganyika. Tanzania has the largest animal population density out of any country in the world. Download limit exceeded you have exceeded your daily download allowance. Because of this, tax avoidance is not considered as an offence. The debate was therefore the only one of its kind in the constitutional history of tanzania.

Tanzania recognizes the importance of investment to stimulate economic growth and create a potential for sustainable future revenue generation. Pdf investigation on tanzanias economic history since. Tax administration reforms in tanzania harry kitillya tanzania imf conference on revenue mobilization and development, april 1719, 2011, washington dc created date 4152011 2. The history of tanzania can be traced back before co. Before the existence of a monetary system, taxes were paid by a percentage of crops raised. Stay caught up on recent news stories involving the taxation system in tanzania, africa. A nonresident company is taxed in tanzania to the extent that the income has been sourced in the united republic of tanzania. Most citizens were subject to a poll tax, which was a flat tax on every adult in a jurisdiction, as well as property and church taxes. That is, there are more animals per square mile of land in tanzania than in any other country. In the wealth of nations book v, chapter 2 he set down four general canons.

The history of income taxes in the united states goes back to the civil war, when abraham lincoln signed into law the nations firstever tax on personal income to help pay for the union war. The author, a senior lecturer of law at the university of dar es salaam, addresses some complex and practical issues about income taxation in tanzania. Through most of history, the tax assessor and the tax collector were the same person. An example of such a revolt was the majimaji rising of 19051907 in tanzania. Introduction to taxation our purposes, the sections on tax structure, types of tax, tax administration, and understating the tax. Investigation on tanzanias economic history since independence. Even peasants that did not own land had to pay property taxes on land that they rented. The history of taxation stretches thousands of years in the past. Oct 02, 2008 beards, boots, beehives, candles, nuts, hats, horses, chimneys, water tsar peter taxed them all. The objective of this study is to assess the impacts of the tax regime instruments, rates, administration and coverage on the growth of firms within five key sectors agriculture, tourism, mining, financial sector, and manufacturing and small businesses, in tanzania. The african great lakes nation of tanzania dates formally from 1964, when it was formed out of the union of the much larger mainland territory of tanganyika and the coastal archipelago of zanzibar. The constitution of the united republic of tanzania accords each local government authority in tanzania mainland the status of government urt, 1998. Tanzania is highly and contains a wide variety of animal habitats.

Taxation is one of the oldest functions of the tanzanian government in running her affairs. In western tanzania, gombe stream national park is the site of jane goodalls ongoing study of chimpanzee behavior, which started in 1960. Ancient civilizations including greeks, romans and egyptians levied different taxes on their people to finance military operations, public services and maintain key strategic reserves of food stocks, gold to mention but a few. Tanzania adopted and periodically reformed the colonial tax systems starting with the poll tax which was introduced by. In 1964, tanganyika was joined with zanzibar, an offshore archipelago of islands, to form. The first human beings in tanzania lived by hunting animals and gathering plants. Mass taxation and statesociety relations in east africa. Commissioner means the commissioner of income tax appointed under the tanzania revenue authority act. In the following, we discuss key features of each of these collection regimes. Culture of tanzania history, people, clothing, traditions. Taxation started in the precolonial era and has been improved over the years.

The country is a republic, and achieved this status on october 9, 1962 when the country attained independence from british colonial rule. But he is still styled the great in modern histories of russia, perhaps because of the mighty works his taxes produced. The second is to consider the evidence on taxation and growth for a. Individual taxation nonresidents are taxed only on income derived from tanzania. The intention of the tax was to cover administrative expansion ways by which africans would be forced to work in european farms in order to raise money to pay their taxes. This means that each local government or council can raise funds for meeting the costs of delivering public goods and services including financing development projects. All produce generated from the dedicated portion of land was taken as a tax. Urt united republic of tanzania vat value added tax. Abstract sme tax systems need to be designed in such a way as to minimise compliance. The concepts that evolved were transported to other empires and cultures where tax ideas took root. The research was conducted in dodoma municipal council. The historical background of taxation in nigeria indicates that the first form of taxation occurred in northern nigeria. Mainland tanganyika covers more than 99 percent of the combined territories total area.

The thesis thus reports on the examination of property tax administration in ilala, kinondoni and temeke municipal councils in dar es salaam. All central government taxes are administered by the tanzania revenue. The two presidents sign an act of union, bringing their nations together as the united republic of tanzania. It served as a british military outpost during world war. The chinese instituted a form of property tax around 600 b. Construing the political economy of tanzania and uganda as background for understanding the further impacts on tax reforms and compliance requires. As a result of the debate there demands for more autonomy of zanzibar which threatened the party and led to announcing a pollution of political atmosphere forcing the then leadership of zanzibar to resign.

A tax can either be proportional, progressive or regressive. This pattern continues through to today as nations are influenced by developments in tax from other countries. The first, pursued through a history of poll taxes in tanzania and uganda, is to explain how they have. During colonial era, income, customs and excise taxes were under east african high commission, while district commissioners oversaw the collection of personal tax on behalf of treasury.

In the united states, the role of the government extends from providing for national defense to providing social security and medicare to the elderly. Tax reform, tax compliance and statebuilding in tanzania. Tax administration reforms in tanzania international monetary fund. Tanzania was formed as a sovereign state in 1964 through the union of the theretofore separate states of tanganyika and zanzibar. Open university of tanzania a dissertation entitled. They argue that major wars coincide with permanent improvements in tax instruments and tax collection technology, which facilitated permanent expansions in government size thereafter. It is said that the mainland portion of what is now tanzania was named by a british civil servant in 1920, from the swahili words tanga sail and nyika bright arid plain. A researched work of the whole media history in tanzania.

What is the historical background of taxation in tanzania. The tax systems in mozambique, tanzania and zambia. Tax evolved and developed independently in the great ancient empires. The basic principles of taxation are nearly as old as human societythe history of taxes stretches thousands of years into the past. Although the history is interesting, for 1 unit 01. Reflecting on revenue collection in tanzania international.

For capital importers, encouraging inbound investment may be more in the focus, with policy makers wishing to attract foreign direct investment entailing the transfer of skills and technologies and thus fostering economic growth. By definition, a tax is a compulsory contribution from a person to the state to defray the expenses incurred in the common interest of all without any reference to the special benefits conferred. Tanzania per tax exemptions study draft final report october 20 list of acronyms brn big results now bot bank of tanzania cag controller and auditor general. Martin sturmer goes through all these phases and comprehensively brings together what we have not had in tanzania before. Notes on income tax laws tax year 2012 muhammad ovais, deloitte th mfc 3 company. Kilimanjaro, the tallest mountain in africa, with its summit at 19,340 feet 5,895 meters. Hence the term tax or taxation still begs for a definition. A brief history of property tax collection in tanzania. The tax regime in tanzania consists of a number of direct and indirect taxes including. This section consists of various tax laws which oversee taxation process in tanzania. Tanzania adopted and periodically reformed the colonial tax systems starting with the poll tax which was introduced by the british in the early 20th century. The applicable tax rates depend on the source or nature of income. The incidence of fiscal policy in tanzania presentation at kilimanjaro hotel dar es salaam january 20, 2016 stephen d.

In kenya the hut tax was introduced in 1980, and poll tax in 1910. In order to provide for these program and services, the government needs revenues. Jun 10, 2014 the historical background of taxation in nigeria indicates that the first form of taxation occurred in northern nigeria. So far, attempts to increase tax revenue have focused on closing the taxation gap and expanding the tax base.

This paper first presents theoretical models that integrate avoidance and. Taxation has existed in various forms since civilization began. You may think that income tax has been a staple drag in our lives since the beginning of time, but you will be surprised to learn that tax on a mass scale is a relatively new phenomenon. As a result, the gb exploited the resources and people of africa. The 18thcentury economist and philosopher adam smith attempted to systematize the rules that should govern a rational system of taxation. Several ancient civilizations, including the greeks and romans, levied taxes on their citizens to pay for military expenses and other public services. The study intended to assess challenges facing property tax collection in tanzania. An economic perspective on double tax treaties within developing countries capitalexporting countries. The hindering factors to achieve full potentiality on tax revenue collection in tanzania, a case of tanzania revenue authority in temeke region, in partial fulfillment of the requirements for the degree of master of business administration of the open university of tanzania. Tanzania and uganda, is to explain how they have affected statesociety relations and why it has taken so long. The first approach is to examine the historical record of the u. Introduction to taxation government plays an important role in most modern economies.

Pdf mass taxation and statesociety relations in east africa. Read it with the goal of gaining a broad understanding of tax purposes and principles. Lets take a short walk through time to understand what we. The first, pursued through a history of poll taxes in.

To help clear this up, we have brought you a rough history of taxation in the uk. There was a ten year break, as in 1972 the local government was abolished and replaced with a direct central government rule. Tanzania per tax exemptions study draft final report october 20 page i introduction context and objective of the study tanzania has moved in a positive direction in domestic revenue collection, attributed to wide ranging reforms, including the operationalization of the tanzania revenue authority tra in. It consists of the main laws, regulations and finance acts.

The former was a colony and part of german east africa from the 1880s to 1919, when, under the league of nations, it became a british mandate. Uganda is a landlocked country located in east africa. A proportional tax is a tax whose burden is the same rate regardless of the income earned by the household. The exact point in time when tax was first instituted is unknown due to poor historical records, culture and societal structure of ancient. Proceedings of the 9th international management conference management and innovation for competitive advantage, november 5 th6, 2015, bucharest, romania the importance of taxation systems for sme tax compliance. Although they need to be reinterpreted from time to time, these principles retain remarkable relevance. Property tax reform was a central component of the of decentralisation process in tanzania. Effects of the tax system in tanzania on investments and growth. Looking at the history of taxation in nigeria, the beginning of the colonization period was connected with various trading posts and companies in the west africa. Rental income net rental income earned by nonresidents is taxed at a flat rate of 20%. In considering the effects of the lowrate, broadbase tax reform strategy that has been adopted, it is argued that there are major shortcomings in the implementation of. In tanzania, the body that is responsible for tax collection is tanzania revenue authority tra. History of oda tax exemptions the current system of international development assistance, and the tax exemptions that go with it, took shape at the end of the second world war see fjeldstad, 2009. Tanzania has 16 national parks plus a variety of game and forest reserves, including the ngorongoro conservation area.