Tanzania mobile money levy explained: withdrawal tax, excise & VAT (Tozo la Miamala) 2026
Tanzania's mobile money tax stack has three parts today: a 10% excise duty and 18% VAT on operator fees, plus the government withdrawal levy (the tozo) on agent cash-out — banded from TSh 10 up to a maximum of TSh 2,000. Introduced in July 2021 on both transfers and withdrawals, it was cut twice; on 1 October 2022 the TRANSFER levy was scrapped but the WITHDRAWAL levy was kept, with its ceiling cut to TSh 2,000. Here's the full history, the current applied taxes, and what changed.
The 2021-2022 withdrawal levy story
July 2021: Tanzania's government introduced a tiered withdrawal levy — TSh 10 to TSh 10,000 across 22 transaction bands — to fund development spending. The labelling at launch was 'patriotic levy'. The tax was layered on top of the existing 10% excise and 18% VAT, making the effective tax burden on small-amount withdrawals as high as 35% of the transaction value (IDS/ICTD research). Mobile-money transaction volumes contracted sharply.
September 2021: government cut the levy by 30%. July 2022: another 43% reduction. 1 October 2022: full scrap. The two reductions and the eventual scrap were a direct response to public outcry, declining transaction volumes, and published evidence of financial-inclusion harm (10-18% decline in rural household food consumption per ICTD).
What still applies today: excise + VAT on operator fees
Tanzania's Excise (Management and Tariff) Act applies a 10% excise duty on mobile money operator fees (not on the transaction amount). The standard 18% VAT also applies to the operator fee. Both are compounded — VAT applies to the operator fee plus excise — giving an effective multiplier of (1 + 0.10) × (1 + 0.18) = 1.298. A TSh 1,000 operator fee becomes TSh 1,298 all-in.
What's NOT taxed: the transaction amount itself
Tanzania's current stack taxes the operator's revenue (the fee), not the transaction principal. Sending TSh 100,000 to a relative does not generate a tax on the 100,000 — only on the operator's published P2P fee. That's a structurally different framework from a percentage-of-amount tax like Uganda's URA 0.5% levy (which is a true transaction-amount tax). The difference grows materially on large amounts: a TSh 1,000,000 send carries only TSh ~500-1,000 of compounded operator-fee tax in Tanzania.
Sources
- Connecting Africa, "Tanzania scraps mobile money tax" (22 Sep 2022).
- PYMNTS, "Tanzania Backtracks as Mobile Money Levy Proves Unpopular" (2022).
- ICTD / IDS, "How Tanzania's Levy on Mobile Money Affects Small Businesses" (ongoing publications).
- GSMA, "Tanzania Mobile Money Levy Impact Assessment" (2022).
- Tanzania Revenue Authority Finance Act 2024 + Finance Act 2025 (no reinstatement of the per-transaction withdrawal levy).
- Excise (Management and Tariff) Act — 10% excise on mobile money operator fees; VAT Act — standard 18% rate.
All values verified June 2026. Operator tariffs cross-checked against Vodacom Tanzania, Yas / Mixx by Yas, Airtel Tanzania and Halotel published sources; review cadence is quarterly.