MPesa excise duty in Tanzania

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New excise duty on MPesa services in Tanzania.

Tanzanian govt imposes new excise duty on all MPesa commissions. Finance and Planning Minister Philip Mpango told parliament in his budget speech that a new 10 percent excise duty on mobile money transactions will apply for both sending and receiving transactions. At present, only commission on customers sending MPesa is taxed.

The main fees received by mobile phone service providers for MPesa services is presently outside the tax net. Seemingly, mobile firms used the gap to charge less commission on senders and more for the recipients. The minister said the plan would plug tax evasion excuses in the surging mobile money business, where billions of shillings are moved yearly.

According to data from Tanzania Communications Regulatory Authority. Tanzania had seven mobile operators with about 39 million subscribers by March. About 16 million subscribers are registered with MPesa like money transfer services.

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