The 2021/2022 Zanzibar Government Budget had proposed to harmonize the tax table rates applicable to Mainland Tanzania. The Finance Act 2021 does not dictate the tax rate changes to apply to Zanzibar.
The decision to not change the Zanzibar tax rates, is that although Mainland Tanzania and Zanzibar are governed by the same law, namely the Income Tax Act, any changes in Zanzibar must be announced by the Minister of Finance through the Finance Act or Miscellaneous amendments.
Correspondence has been issued from the Tanzania Revenue Authority through the PAYE Guide for the 2021/2022 tax year suggesting that the new PAYE rates now apply to both Mainland Tanzania and Zanzibar. It is also confirmed through the online PAYE Tax Calculator available from the Tanzania Revenue Authority website, that when the location is Zanzibar, the new tax tables are reflected.
The Zanzibar tax table rates will align with Mainland Tanzania.
Click here for the Tanzania PAYE Tax Guide.
Zanzibar Tax Table Changes
The tax tables have been updated effective 1 July 2021.
| Lower Income Limit | Upper Income Limit | Income Threshold | Marginal Rate | Tax on Threshold |
| 0.00 | 3 240 000.00 | 0.00 | 0% | 0.00 |
| 3 240 000.00 | 6 240 000.00 | 3 240 000.00 | 8% | 0.00 |
| 6 240 000.00 | 9 120 000.00 | 6 240 000.00 | 20% | 240 000.00 |
| 9 120 000.00 | 12 000 000.00 | 9 120 000.00 | 25% | 816 000.00 |
| 12 000 000.00 | 9 999 999 999.99 | 12 000 000.00 | 30% | 1 536 000.00 |
Impact of Zanzibar Tax Year Changes 2021 on payroll:
- The Zanzibar Tax Year changes 2021 have been implemented on the system effective 01 July 2021.
- Customer payrolls were switched to the Non-Cumulative (MTD) tax method and the Averaging (YTD) tax method was removed in July 2021, due to tax tables changing mid tax year.
- Customers are expected to post-tax adjustments if the pay periods for July and August have been closed.
- No other statutory changes have been announced for Mainland Tanzania and Zanzibar.
Should you have any questions regarding this change, please feel free to visit our Support page for more ways to get in touch, or email us at [email protected].
The PaySpace Team
