Mobile Money Transfer Levies
The Levy Regulations 2021 were subsequently amended so as to reduce the levy rates in response to heavy opposition from the general public. The reduced rates were given effect by the National Payment Systems (Electronic Mobile Money Transfer and Withdrawal Transactions Levy) (Amendment) Regulations GN No. 642A of 2021 (the Levy Amendment Regulations 2021).
Electronic Money Transaction Levy – New Regulations
Further changes to the mobile money levy regime have since been introduced in the financial year 2022/2023. The Parliament amended section 46A of the NPS Act through the Finance Act No. 5 of 2022 and enacted the National Payment Systems (Electronic Money Transaction Levy) Regulations GN No. 478V of 2022 (the New Regulations).
Section 46A now reads as follows:
Further changes to the mobile money levy regime have since been introduced in the financial year 2022/2023. The Parliament amended section 46A of the NPS Act through the Finance Act No. 5 of 2022 and enacted the National Payment Systems (Electronic Money Transaction Levy) Regulations GN No. 478V of 2022 (the New Regulations).
Section 46A now reads as follows:
- “There is established a levy to be charged on mobile money transfer transaction at a rate ranging from 10 to 4,000 Tanzanian Shillings.
- The Minister [for Finance] shall, after consultation with the Minister responsible for communication, make regulations prescribing the manner and modality under which the levy on mobile money transfer transactions may be collected and accounted for.
- The provisions of this section shall not apply to transactions involving payment of salaries by employers.”
Key changes to the Levy
Section 46A of the NPS Act has been amended to reduce the maximum amount of the levy, which was initially set at TZS 10,000 by the Finance Act No. 3 of 2021 and thereafter, amended to TZS 7,000 by the Levy Amendment Regulations 2021. It has now been reduced to TZS 4,000 for an electronic money transaction of TZS 3,000,0001 and above, which is a 43% decrease from the latter. It also excludes transactions involving the payment of salaries by employers from the levy.
Under the New Regulations, the levies are payable by “users” of electronic money and collected by the relevant bank, financial institution or electronic money issuer. A “user” is defined as a person who “transfers” or “withdraws” money electronically or over the counter other than the Government, merchant or business.
The New Regulations have redefined the terms “transfer”, “user” and “withdrawal” as compared to the Levy Regulations 2021 so as to clearly define the scope of the levy.
Section 46A of the NPS Act has been amended to reduce the maximum amount of the levy, which was initially set at TZS 10,000 by the Finance Act No. 3 of 2021 and thereafter, amended to TZS 7,000 by the Levy Amendment Regulations 2021. It has now been reduced to TZS 4,000 for an electronic money transaction of TZS 3,000,0001 and above, which is a 43% decrease from the latter. It also excludes transactions involving the payment of salaries by employers from the levy.
Under the New Regulations, the levies are payable by “users” of electronic money and collected by the relevant bank, financial institution or electronic money issuer. A “user” is defined as a person who “transfers” or “withdraws” money electronically or over the counter other than the Government, merchant or business.
The New Regulations have redefined the terms “transfer”, “user” and “withdrawal” as compared to the Levy Regulations 2021 so as to clearly define the scope of the levy.
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