Unguja. The Revolutionary Government of Zanzibar (RGZ) has emphasised the growing importance of the digital economy as a driver of market expansion and job creation, announcing measures to formally recognise and regulate online businesses.
To create a more enabling environment for growth, online trade has been incorporated into the Zanzibar Trade Policy 2024, identified as a core priority within broader commercial strategies.
The details were disclosed on Wednesday, February 25, 2026, by the Deputy Minister for Communications, Information Technology, and Innovation, Mr Mohammed Sijamini Mohamed.
He was speaking in the House of Representatives while responding to a question from the Chake Chake Representative, Mr Abdulwahab Said Abuubakar (CCM), who sought clarification on the steps being taken to legitimise virtual trade and ensure operators pay their due taxes and levies.
In his response, Mr Mohamed said the ministry has formulated the Zanzibar Digital Policy 2026, noting that the framework sets out strategies to strengthen online commerce across priority sectors, enhance efficiency, and support the growth of small electronic enterprises.
“The government has prepared the Zanzibar Digital Economy Direction 2023–2027, in which online business is formally recognised as a key source of state revenue,” the Deputy Minister said.
He explained that the policies are aimed at expanding domestic, regional, and international markets, while harnessing technology and innovation to add value, enhance product presentation, and promote digital entrepreneurship.
Acknowledging that social networks and digital platforms have unlocked significant economic opportunities, Mr Mohamed emphasised the need for a robust fiscal system to capture eligible taxes.
To this end, legislative reforms are already underway. Notably, the Value Added Tax (VAT) Act of 1998 was amended in 2024 to better align with contemporary revenue requirements.
Additionally, the Finance Act (Public Revenue Management) of 2024—Sections 4A and 4B, now requires non-resident traders providing electronic services or conducting business without a permanent physical presence in Zanzibar to register and remit VAT.
“The law now mandates electronic service providers without a residence or permanent office in the Isles to register with the Zanzibar Revenue Authority (ZRA) and pay VAT on income generated from local economic activities,” clarified Mr Mohamed.
Alongside these legal measures, the government is conducting awareness campaigns to educate digital entrepreneurs on tax compliance and the use of electronic payment systems.
According to the Deputy Minister, the goal is to ensure traders understand their fiscal obligations and the security benefits of timely payments via digital platforms.
The government remains fully committed to formalising the sector through policy, strategy and integrated digital infrastructure.
