Informal sector - untapped tax potential?

What you need to know:

Tanzania’s informal sector is significant (which is where the majority of the MSME would be found) but if this sector could be part of the formal economy, the benefits in terms of widening the tax base and collection of tax would be immeasurable.

For MSMEs a constant concern is the numerous levies and charges on employee costs - something particularly pertinent to MSMEs given that these typically are very people driven businesses for which labour costs are a significant component of costs. Taxes related to employment include not just the PAYE borne by the employee, but also a four percent skills and development levy and 0.5 percent Workers Compensation Fund both borne by the employer, and a 20 percent social security cost (borne jointly by employer and employee). One step to help reduce taxes on employment for MSMEs could be to exempt them from SDL. Currently there is an exemption for employers with up to 10 employees and the proposal here would be to consider an increase in this threshold - perhaps to 25 employees - and also to provide for an exemption where annual turnover is below a certain amount, say Sh200 million.

Informal sector - untapped tax potential?

What you need to know:

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What you need to know:

Making digital tax work for Tanzania

Simba complete 9-1 demolition to reach CAF groups

Tanzanian university students make sci-fi movie about alien invasion

Tanzania secures Sh3.67 trillion for 424km SGR link from Makutupora to Isaka

Samia to inaugurate Sh700bn Government City on October 30

Same launches seven-day operation to drive elephants from settlements

The Last Conversation brings Tanzania’s mental health crisis to the screen at TASUBA

Samia to inaugurate Sh700bn Government City on October 30

Tanzania secures Sh3.67 trillion for 424km SGR link from Makutupora to Isaka

Same launches seven-day operation to drive elephants from settlements

UDSM exam changes raise concerns over delayed graduation, costs