PAYE Tanzania Just Got Better – President Magufuli Reduces Employee Income Tax To 9%

PAYE Tanzania – In fulfillment of his campaign promise, President Magufuli has reduced the personal income tax in Tanzania from 11% to 9%. 

The initial Pay As You Earn (PAYE) policy operated on a charge rate of 11%. President Magufuli gives Tanzanians a Workers’ Day to remember by reducing it to 9%. He made the announcement while rendering his official Worker’s Day address in Jamhuri stadium, Dodoma.

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The PAYE Tanzania operates on the locus that “an employer is required to withhold income tax from salaries, wages and all other payments forming taxable income paid to an employee.” In other words the employer is legally bound to deduce a certain percentage of the worker’s pay.

The President says that the reduction in the personal income charge was to ease the burden of the people. This will be another of the ‘Magufulication’ act that Tanzanians will have in their good book.

In his speech, the President appreciated government workers who have faithfully adhered to paying their taxes. He contradicted their virtuous act with some dubious businessmen who evade taxes.

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Magufuli who is not backing down in the fight against corruption anytime soon says that he is still on the ghost-workers hunt. He stated that about 10, 295 ghost workers are currently ripping the nation off an estimated Sh11 billion ($5, 020, 400) on annual basis.

Nevertheless workers’ welfare is a priority in his list. He did not also forget to mention the economic gap this will create. He said:

“I promised during my campaign to reduce pay as you ear tax to single digit. Now I declare to reduce it from 11 percent to nine percent. I know this percentage will create a gap in our revenue, but we shall see how to fill it.

So as the people fulfill their obligatory civic duty to the nation that gives them identity, so also has the Tanzanian president appreciated and rewarded their compliance.