Dar es Salaam — A presidential commission has proposed 284 sweeping reforms to overhaul the nation’s tax system, recommending a shift towards a paperless administration and the renaming of the revenue authority to foster a more business-friendly environment.
President Samia Suluhu Hassan received the comprehensive report during an official ceremony at the State House on March 18, 2026. The nine-member commission, chaired by former Chief Secretary Ambassador Ombeni Sefue, was established on July 31, 2024, following decades of complaints from citizens and investors regarding the current tax framework.
The proposed reforms mark the first major review of the tax system since the Mtei Commission operated between 1989 and 1991. The recommendations come at a critical juncture as the nation prepares to implement its Development Vision 2050, which targets a US$1 trillion economy.
President Samia endorsed the reform agenda, emphasising the need to modernise the tax system to support the nation’s ambitious development goals. She noted that the private sector is expected to contribute 70 per cent of the funding for Vision 2050, making a conducive tax environment essential.
“We must remove the layers of tax complaints and start afresh with a better system that meets current needs,” the Head of State remarked.
READ MORE: How Fair Is Tanzania’s Tax System?
The commission’s 284 recommendations are categorised into seven main areas, with the majority focusing on policy and legislation. Ambassador Sefue outlined the breakdown, which includes 146 recommendations on policy and legislation, 41 on systems and technology, and 30 on governance matters.
“We have identified various issues within the tax administration system in the country which are still a cry of taxpayers,” Ambassador Sefue said.
Systemic challenges
During his presentation, Sefue highlighted several systemic challenges that the commission identified, including high tax rates implemented without considering broader national goals. He also pointed to an ineffective dispute resolution system that has caused taxpayers to lose confidence.
“There are many regulatory authorities collecting revenue,” he said. “And when we say revenue, it is not necessarily tax [collected] alongside the Tanzania Revenue Authority and local government authorities without coordinated arrangements.”
This lack of coordination has resulted in multiple authorities collecting fees and levies from the same source, causing confusion and high compliance costs. Sefue noted that the situation has become so burdensome that some stakeholders see bribery as the only solution.
READ MORE: President Samia Defends Ousted Tax Boss. Here is Why the New Commissioner Has His Work Cut Out
“As a result, they all collect fees, levies, and excise duties from the same source and the same taxpayers, thus causing confusion, disturbance and high costs for stakeholders, to the point that some see it better to pay bribes to eliminate the problem,” he emphasised.
Technological solutions
To address these challenges, the commission strongly advocated for the integration of fragmented technological systems and a shift towards a more customer-centric approach. A key recommendation is the development of a user-friendly mobile application to facilitate easier tax compliance.
“We recommend that the Tanzania Revenue Authority develop a simple app that will enter any person’s phone that will be used as a gateway for taxpayers and establish a system that will largely be faceless and paperless,” Ambassador Sefue said.
The proposed app would enable taxpayers to register, file returns, view liabilities, and make payments through digital channels. The commission also recommended leveraging artificial intelligence, big data, and blockchain technology to enhance transparency and efficiency.
“We recommend removing the procedure of tax officials meeting face-to-face with taxpayers and reducing the use of cash and paper, as I said, a faceless, cashless, paperless system and as much as possible,” Sefue added. “All matters should be conducted through networks.”
A shift in culture
Beyond technological upgrades, the commission emphasised the need for a fundamental shift in the mindset and culture of tax administration officials. To reflect this change, they proposed renaming the revenue authority.
“We recommend that the Tanzania Revenue Authority and all those with tax authority change their mindset and build a new culture of service to taxpayers,” Sefue said. “And to align with that mindset, we recommend that the Tanzania Revenue Authority be renamed from Tanzania Revenue Authority to Tanzania Revenue Service.”
The commission also stressed the importance of creating a comprehensive ecosystem to support small businesses and encourage formalisation. Sefue noted that the current tax base is too small, placing a heavy burden on the few who operate within the formal system.
“There is still no complete and comprehensive 360-degree ecosystem for identifying, nurturing, and developing small entrepreneurs and those starting new businesses,” he added. “This is a very big cry of citizens everywhere we went, especially young people, for many days.”
Commitment
The commission’s report represents a watershed moment for the nation’s tax administration, reflecting extensive consultation with stakeholders and international benchmarking visits to England, India, Vietnam, and South Korea.
President Samia endorsed the reform agenda, emphasising the need to modernise the tax system to support the nation’s ambitious development goals. She made a strong personal commitment to seeing the reforms through.
“I prefer that when I leave, I leave this thing completed and I have built a strong foundation for the implementation of our vision going forward,” she said.
She acknowledged that the transition would not be easy, comparing the necessary reforms to shedding old skin or straightening a deformed limb. The President called for patience and dialogue during the implementation phase.
“Change hurts,” she said. “For a long time, 35 years back, we have been going with the tax style we had. Now, if it is a deformity, you have to go and unfold that arm, which is folded, like this [demonstrating], there must be pain. The arm wants to be straightened, the pain will be there.”
One Response
i Have read this news with satisfaction, the first of its kind in the 40 years I have been in Tanzania. I first became involved in trying (from the private sector side) – to untangle many of these issues 30 years ago (our first tourism venture was launched in 1990). My first “brush with the law” was the change in the TALA licence fee in 1988, from TZS 2,000 (local) and TZS 5,000 (foreign) to US$ 2,000 and US$ 5,000 respectively. As taxes and fees and service charges are defined in law by their nature (defined purpose) this move could be legally challenged (which I did, but that’s another long story). The important point is that it underlines the shift from a licence fee to collect information on the structure and activities of an industry to one of “collection”, which has dominated the setting of taxes, fees and charges in the last two decades and involving three levels of governance and many of its institutions. Since those heady days I have been involved in many written reports and submissions that were appeals to the authorities in tourism, agriculture, aviation and related fields to do what this Commission has apparently recommended (we await details). I was also part of the PPP movement initiated by the late President Mkapa that involved regular meetings to hear and debate the findings of key of joint ministry-business committees to address the country’s economic, legal and administrative policies, implementation and impact on development (incidentally, the principal finding of this process was that “poor law” in the form of enabling regulations, including sheria ndogo at the local level, were the key drivers of the explosion in “taxes”. The real problem is that again and again the Government has stopped short of ACTION to get things done, often derailed by legal problems created by duplicated, overlapping and contradictory regulations. The tangle of service charges, fees, levies, cesses, etc that have accumulated over and above the real (ie TRA-administered) taxes and statutory charges bandwagon has led to “taxes” at many levels and is underscored by the ability of institutions to charge for their “operations” or “services” – and apply penalties, sometimes of outrageous levels with no appeal. It has also led to unfair blame handed to TRA for the “treacherous” business environment. First and foremost any and all funds collected by Government and its myriad institutions should be channeled to the Ministry of Finance ONLY. Cancel ASAP “own use” funding for clarity, transparency and efficiency. Apply the budgetary process of annual government expenditure to ensure compliance with policy and project development. As it stands “everybody’s doing it” as the song goes, and they do NOT want to change. For foreign investors these charges have a far greater negative impact, being much more than for local businessmen. As a result, they have also mutilated economic policy leading to low levels of compliance and “selective targeting” of foreign investment businesses. Instead of being brought under control these have multiplied drastically over the last decade (I speak of tourism and agriculture, my prime areas of experience), with no respite and complete disregard for at least a dozen detailed studies (including those funded in very recent years by World Bank, African Development Bank, European Union) and endless submissions, meetings and discussions, framed as PPP or “engaging with the business sector”. I can quote no improvements in the “business environment” over three decades but I can describe many detrimental impacts on operations, misplaced policy outcomes, misused funding and lower economic development, employment and human resources advances, as well as increased avoidance. Will the findings of the Commission lead to (hopefully rapid) results ? It needs a “task force” approach with “mission orientation” and Presidential powers to suspend or cancel many of the problems that are now legally entrenched. Doing this may take years, unless by the strength of decree. It will not be easy as institutions, councils and authorities will cling to their claims, arguing for total independence.