AfrikanTrust, April 6 2025
In a bold testament to Tanzania’s fiscal tightening and economic resurgence, the Tanzania Revenue Authority (TRA) has announced that it collected a total of 7.53 trillion Tanzanian shillings (approx. €2.71 billion) in the third quarter of the 2024/2025 financial year—January to March—exceeding projections and setting a new benchmark in the country’s tax administration history.
The figures, unveiled by TRA Commissioner General Yusuph Mwenda in Dar es Salaam on Thursday, represent a 101.32% performance against the quarter’s target of 7.43 trillion TZS (approx. €2.67 billion) and mark a 13.47% rise from the 6.63 trillion TZS (€2.39 billion) collected during the same period in the previous fiscal year.
This is not a standalone success story. The momentum has been consistent, with TRA surpassing monthly revenue targets for six consecutive months. Cumulatively, from July 2024 to March 2025, the revenue authority collected a staggering 24.05 trillion TZS (€8.66 billion), well ahead of its target of 23.21 trillion TZS (€8.37 billion), reflecting a 103.62% achievement rate. Compared to the same nine-month period last year, when 20.55 trillion TZS (€7.4 billion) was collected, this marks a 17.01% increase. More striking is the comparison with three years ago—2020/2021—when collections stood at 13.59 trillion TZS (€4.89 billion), signifying a 77% jump.
TRA’s Mwenda attributed this fiscal performance in part to the leadership of President Samia Suluhu Hassan. Under her administration, there’s been a notable pivot toward enhancing voluntary tax compliance, digitalizing revenue collection systems, and fostering a business-friendly environment. These elements have not only increased taxpayer confidence but also widened the country’s tax base.
“The government’s focus on enhancing the business environment and improving services for taxpayers contributed significantly to this achievement,” Mwenda noted.
President Samia’s soft-power approach—marked by inclusivity, digital transformation, and diplomatic finesse—appears to have re-engineered the dynamics between the government and Tanzania’s business community. Where once the TRA was seen as a blunt instrument of coercion, it is now increasingly perceived as a strategic partner in national development.
A key driver of this transformation has been technological modernization. TRA’s early 2024 upgrade of its customs management system—known as TANCIS (Tanzania Customs Integrated System)—has been a game-changer. The digital platform has significantly streamlined the monitoring and collection of customs duties, minimized border delays, and curtailed the loopholes that facilitated tax evasion.
In parallel, the widespread rollout of Electronic Fiscal Devices (EFDs) across businesses—particularly among small and medium-sized enterprises (SMEs)—has improved the accuracy of tax reporting. TRA’s collaborative efforts in sensitizing businesses about EFD benefits have contributed to deeper integration of the informal sector into the formal economy.
“As of now, thousands of businesses across Tanzania have integrated EFDs into their operations, further improving tax compliance,” the TRA emphasized.
But the numbers only tell half the story. What lies beneath the revenue surge is a cultural shift in how Tanzanians view taxation. TRA has invested heavily in public tax education campaigns, demystifying tax obligations and breaking down the wall of mistrust that long separated the state from the average taxpayer.
“Our goal is to create an ecosystem where businesses feel supported, and in turn, they are motivated to fulfill their tax obligations,” said Mwenda.
This human-centric approach to tax administration aligns with global best practices and is reminiscent of reforms seen in Rwanda, which is often cited as a regional benchmark in efficient tax collection and public service delivery.
Another crucial enabler of this fiscal uptick has been broader policy reform. Tanzania’s push to reduce trade barriers, simplify business registration processes, and encourage foreign direct investment (FDI) has increased the flow of goods and services across its borders. The rebound in international trade—buoyed by relative global economic recovery—has also played to Tanzania’s advantage.
With increased trade volumes comes higher customs duty and VAT collections—two of the most significant pillars of TRA’s revenue strategy. This improved flow is not just a product of domestic efficiency, but also of regional integration through the East African Community (EAC), which is steadily moving toward a more harmonized customs and taxation framework.
Despite the celebratory tone, analysts caution that sustained revenue growth will depend on more than just internal administrative reforms. Tanzania must now grapple with global headwinds: oil price volatility, foreign currency fluctuations, and geopolitical tensions that could disrupt trade flows.
Moreover, there remains the challenge of reducing the country’s overreliance on indirect taxes, such as VAT and import duties, which tend to disproportionately affect lower-income citizens. Diversifying the revenue portfolio through more progressive taxation—like property and capital gains taxes—will be essential to ensure fiscal sustainability and social equity.
The Q3 revenue performance is more than a bureaucratic success—it is a reflection of deeper systemic change. Tanzania’s story offers a compelling case study for other African nations grappling with tax leakages, low compliance, and public mistrust. The convergence of political will, technological innovation, and a pro-business posture is proving that reform, though gradual, is possible.
As Tanzania continues to position itself as an economic powerhouse in East Africa, its tax machinery must remain agile, inclusive, and visionary. The challenge now is to translate this revenue success into quality public services, infrastructure development, and inclusive growth—the ultimate dividends of good governance.
Exchange Rate Used: 1 Euro = 2,780 Tanzanian Shillings (April 2025 estimate)
Figures are approximate and based on current exchange trends.
