Tanzania to raise Sh7.5 billion from sugar and cigarette levies for universal healthcare

He said the government will amend the Excise (Management and Tariff) Act, Cap. 147, to increase excise duty on cigarettes by Sh20 per mille.

In addition, the Sugar Industry Act, Cap. 251, will be amended to introduce an extra levy of Sh10 per kilogramme on both imported and locally produced sugar.

“These measures are expected to raise government revenue of Sh7.5 billion,” Mr Omar told Parliament.

The minister said the Sugar Board of Tanzania will collect the levy and remit it to the Universal Health Fund to support health financing reforms.

He said the proposal forms part of broader efforts to strengthen domestic resource mobilisation and reduce reliance on external financing sources.

Mr Omar noted that the government is implementing the measures amid ongoing global economic uncertainty, including geopolitical tensions and trade disruptions, which have affected revenue stability in many developing economies.

“The government is taking decisive measures to safeguard the welfare of citizens and ensure stability of the economy,” he said.

He added that strengthening domestic funding sources for health would reduce vulnerability to external shocks while supporting long-term improvements in access to healthcare services.

According to the minister, the broader policy direction is to support domestic production and reduce dependence on imported goods that are exposed to fluctuations in global markets.

The new levies are part of a wider fiscal strategy aimed at expanding the tax base while financing priority social services, particularly in the health sector.