Procuring entities/companies, are you aware of these changes to the VAT Act?

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The Finance Act, 2025 made a slight changes to the VAT Act, Cap 148. The principal Act was amended in section 5 by introducing withholding VAT obligation on supplied good and service.

It’s implementation.
Withholding agents is required to withhold VAT from the payment targeted to be made to the supplier and remit to TRA at the time when the VAT return is due to be filed and paid.

When the rate shall be eighteen percent as per section 5 (1), the withholding agent shall be required to withhold the rate of;

• 3% of the VAT payable on the supplied of goods
• 6% of the VAT payable on supplied services

Since the valued added tax rate is 18% on supplied goods and service, then the supplier will receive.

• 15% of output VAT on goods supplied
• 12% of output VAT on services offered

HALA Consultants advises procuring entities/companies to ensure the compliance with the legal requirements as per these changes.

HALA Consultants
Certified Public Accountants
info@halaconsultants.co.tz
0752187434