Tanzania targets investment growth with new tax deal

Dar es Salaam. The government has signed an agreement to avoid double taxation with the Czech Republic in a strategic move to boost foreign direct investment (FDI) and strengthen economic cooperation between the two countries.

Trade between the two nations has grown steadily since 2022, particularly in the services, machinery, electrical equipment, transport, and technology sectors.

The Organisation for Economic Co-operation and Development (OECD) says countries with comprehensive double taxation agreements attract up to 30 percent more FDI than those without such treaties.

The Minister for Finance, Dr Mwigulu Nchemba, announced the new development on Wednesday, May 14, 2025, during the signing ceremony held in Dar es Salaam.

Dr Nchemba hailed the agreement as a milestone that would remove tax-related bureaucratic barriers, protect investor returns, and foster a more enabling business environment.

“Avoiding double taxation is not merely a technical matter—it is a vital tool for building investor confidence, ensuring fair returns, and promoting equity in taxation,” he said.

He attributed the achievement to the Sixth Phase government under President Samia Suluhu Hassan, especially the ongoing tax administration and investment policy reforms.

“The government has implemented wide-ranging reforms, including streamlining business registration and licensing processes, and digitising tax collection. These efforts aim to position Tanzania as a premier investment destination,” he said.

Tanzania is currently ranked among the top three investment destinations on the continent—alongside South Africa and Nigeria—with economic growth projected to average six percent by the end of 2025.

“This agreement opens a new chapter for entrepreneurs from Tanzania and the Czech Republic to explore emerging opportunities. I urge all relevant institutions and tax authorities to ensure transparent and effective implementation,” Dr Nchemba added.

He further noted that the agreement would enable Tanzania to maximise benefits from a regional market of over 400 million people, positioning the country as a key commercial gateway in East Africa.

Czech Ambassador to Tanzania, Ms Nicol Adamcova, said the agreement reflects deep mutual trust built through sustained negotiations.

“This agreement not only removes tax-related obstacles but also signals the stability and attractiveness of the investment climate in both countries,” said Ambassador Adamcova.

To further strengthen bilateral relations, she announced plans to travel via the Standard Gauge Railway (SGR) to Morogoro, where she will visit Airplanes Africa Limited (AAL), an aviation joint venture between the two nations.

“Aircraft manufacturing is no small feat. This partnership marks a significant milestone and illustrates the potential for deeper technological collaboration,” she said.

She added that the electric engines used in Tanzania’s SGR trains were manufactured by a Czech company, underscoring longstanding cooperation in infrastructure development.

Ambassador Adamcova also expressed optimism about heightening cooperation in areas of technology, healthcare, education, and research.

She concluded by offering condolences to the Government and people of Tanzania following the death of former First Vice President and Prime Minister Cleopa Msuya, who passed away on May 7, 2025, at Mzena Hospital due to a heart-related illness.

Born in 1931 in Chomvu Village, Usangi, Mwanga District in Kilimanjaro Region.