Tanzania: Regulations clarifying excise duty regime for nonresident providers of digital services

Tanzania on June 30, 2026, published The Excise (Non-Resident Service Provider) Regulations, 2026. Effective July 1, 2026, the Regulations establish registration, sourcing, return-filing, and payment requirements for nonresident providers of specified services supplied through the internet or other electronic means to in-scope customers in Mainland Tanzania.

Taxpayers in scope

The Regulations apply to a nonresident provider that supplies a covered service through the internet or other electronic means to a resident person in Mainland Tanzania who is neither registered nor required to file returns under the Excise Act for the same service. The rules therefore principally concern supplies to unregistered end users, although the statutory test is based on the recipient’s excise-registration and filing status rather than solely on a B2B/B2C classification.

Transactions in scope

Excise duty applies to the following categories of services when supplied by a nonresident to in-scope Tanzanian consumers.

Electronic communication services — 17%

Defined in section 2 of the Excise Act as “a service of any description provided by a person or a company by means of any transmission, emission, or reception of signs, signals, writing, images, and sounds or intelligible information of any nature, by wire, optical, visual, or other electromagnetic means or systems,” including:

• Voice, voice mail, data services, audio/video text services, radio paging, and other emerging electronic communication services
• Fixed telephone services (access to and use of the public switched/non-switched network for voice, data, and video, inbound and outbound)
• Cellular mobile telephone services (including inbound/outbound roaming)
• Carrier services (wired, optical-fiber, or wireless facilities to originate, terminate, or transit calls; interconnection; leased circuits)
• Call-management services (call waiting, forwarding, caller ID, multi-calling, call return/screen/block, voice mail, video conferencing)
• Private network services (electronic communication link between specified points for a client’s exclusive use)
• Data transmission services
• Communication through facsimile, pager, telegraph, telex, and other electronic communication services

Pay-television services, including subscription video-on-demand (streaming) — 7%

The expressly covered services include subscription video-on-demand services that give users access to television programs, films, documentaries, and similar content.

Money transfer and payment services — 10%

The category potentially includes fees or charges for covered money-transfer and payment services delivered through the internet to an in-scope recipient in Mainland Tanzania. The application to a particular remittance, payment-processing, card, wallet, or settlement service will depend on its characterization under the Excise Act and Regulations.

Commercial advertisements relating to betting, gaming, or lotteries — 10%

The duty applies where the covered advertising service is electronically supplied by a nonresident to an in-scope recipient in Mainland Tanzania.

Sourcing

The Regulations set out indicators for determining whether the customer is in Tanzania. Where indicators conflict, they are resolved by reliability, and the customer bears the burden of proving its own registration status. Indicators include (in order of reliability):

• Customer's physical/residential address
• Bank account or billing details
• Internet Protocol (IP) address/geolocation
• Mobile country code of the SIM used
• Fixed landline through which the service is supplied
• Any other commercially relevant and reliable information

Registration

In-scope nonresident providers must register electronically with the Commissioner General and will be issued a taxpayer identification number (TIN). The Regulations do not specify a turnover or de minimis threshold; therefore, a provider appears required to register once it begins making covered supplies. A provider already making covered supplies when the Regulations commenced must register within 90 days after July 1, 2026.

Compliance

Registered providers must file monthly excise returns and pay the duty electronically by the seventh day of the month following the month of supply. Payment may be made in Tanzanian shillings or an equivalent convertible currency, translated using the prevailing Bank of Tanzania exchange rate. Registered nonresident providers are not required to acquire or use an Electronic Fiscal Device.

Penalties

Late-paid excise duty is subject to interest under the Tax Administration Act at the applicable statutory rate. False or misleading statements may attract a penalty equal to 50% of the resulting tax shortfall where made without reasonable excuse, or 75% where made knowingly or recklessly. Other failures may attract additional penalties or constitute offenses under the Tax Administration Act.

KPMG observation

The excise regime forms part of a broader package of digital-economy amendments effective July 1, 2026, which also increased the income tax Digital Services Tax (DST) rate from 2% to 3% and introduced a VAT deemed-supplier rule for digital intermediaries and online marketplaces facilitating electronic services to unregistered persons in Mainland Tanzania. Read TaxNewsFlash.

Providers should assess each tax separately because the covered services, customer-status tests, taxable bases, and persons responsible for compliance are not necessarily identical. Depending on the facts, an electronically supplied service may give rise to more than one Tanzanian tax obligation, but the application of VAT, DST, and excise should not be assumed to overlap automatically.
 

For more information, contact a KPMG tax professional:

Philippe Stephanny | philippestephanny@kpmg.com

Chinedu Nwachukwu | chinedunwachukwu@kpmg.com