- Tanzania’s Finance Act 2025, introduced in July 2025, reduces VAT from 18% to 16% to ease citizens’ financial burden
- The VAT cut is expected to lower fuel prices further, with Tanzanians now paying less than Kenyans at the pump
- Kenyans online raised concerns over Tanzania’s VAT, questioning why similar relief hasn’t been offered at home
The government of Tanzania has implemented proposals in the Finance Act 2025, lowering Value Added Tax (VAT).
Source: Twitter
President Samia Suluhu’s administration implemented the Finance Act 2025, reducing the VAT from 18% to 16%.
Tanzania Revenue Authority (TRA) said the Act, which came into force on July 1, 2025, will effectively be applied based on the public notice specifying persons eligible.
“However, effective application of this provision depends on a Public notice to be issued by the Commissioner General specifying the persons eligible and the manner in which the arrangement shall be implemented,” said TRA.
TRA noted that the Commissioner General is currently working on the requirement put by this provision of the law.
“Once finalised, the public will be informed of the implementation of this law accordingly,” the authority added.
What Kenyans said about Tanzania VAT
The move by TRA caught the attention of many Kenyans, some sharing their thoughts on the VAT charged in the country.
@litmuspaperss wrote:
“Lower VAT to 15% including 1% SHA, and remove the SHIF and affordable housing deductions. The only way we can attain social health.”
@Nyagacm said:
“Good step in harmonising taxes across East Africa. Let us see if Uganda and the rest with 18% rates will follow suit.”
@moneyacademyKE noted:
“Fuel prices in Tanzania are to reduce further as they have decided to cut VAT from 18% to 16% under the Finance Act 2025”
@GudaExperience added:
“Tanzania is taking bold steps to ease the burden on its citizens. Under the Finance Act 2025, the government has reduced VAT on fuel from 18% to 16%, leading to further drops in pump prices.
Meanwhile, in Kenya, VAT on fuel still stands at 16%, yet prices continue to rise. So the question is, if Tanzania can lower taxes to reduce fuel costs, what’s stopping Kenya from doing the same for its people?
Source: Getty Images
Petrol prices in Kenya compared to Tanzania
The Tanzanian government continued to lower the retail prices of petroleum products for motorists and households.
In September 2025, Tanzanians will pay KSh 145 per litre of super petrol compared to KSh 185 paid in Nairobi, Kenya.
Tanzania’s energy regulator attributed this to the drop in international oil market prices during the same period under review.
The decrease in Tanzania’s pump prices came as Kenyan motorists continued to pay more for petrol and diesel.
Motorists using kerosene in Kenya also pay more for the period between August 15, 2025, to September 14, 2025.
In its August review, the Energy and Petroleum Regulatory Authority (EPRA) reduced the prices of super petrol and kerosene by KSh 1 to KSh 185.31 and KSh 155.58 per litre, respectively.
Source: TUKO.co.ke
