By Mwanamkasi Jumbe
The Tanzania Revenue Authority (TRA) has reported marked improvements in voluntary tax compliance as revenue collections continue to exceed targets, underscoring the success of ongoing taxpayer education and service reforms.
Speaking at the mid-year review meeting in Arusha, TRA Commissioner General, Yusuph Mwenda, highlighted that increased voluntary compliance reflects growing trust between the tax authority and businesses, as well as wider public understanding of the role of taxation in national development.
“Many taxpayers now appreciate the importance of paying taxes voluntarily, a trend that has translated into stronger collections and improved relations between TRA and the private sector,” said Mr. Mwenda.
Record-breaking collections underline compliance gains
Recent figures from TRA show that revenue collection is not just improving – it is breaking historical records.
In the second quarter of the 2025/26 fiscal year (October–December 2025), TRA collected TSh 9.8 trillion, exceeding its quarterly target of TSh 9.66 trillion and representing a 12.26 percent increase compared with the same period last year.
Particularly notable was December 2025, when TRA recorded TSh 4.13 trillion – the highest monthly collection in its history, surpassing the previous record set in December 2024.
For the first half of the fiscal year (July–December 2025), TRA collected TSh 18.77 trillion, achieving 103.7 percent of its target and highlighting sustained performance across multiple months.
These gains build on earlier success. In the first quarter of the fiscal year (July–September 2025), TRA reported total collections of TSh 8.97 trillion, exceeding its target by more than 6 percent and marking a year-on-year increase of over 15 percent.
Beyond the numbers: service improvements and technology
The tax authority attributes these results to a series of strategic reforms beyond traditional enforcement. TRA has focused on streamlining taxpayer services – making it easier for businesses to file returns and resolve issues as well as strengthening digital systems and tools – including increased use of Electronic Fiscal Devices (EFDs) and modern tracking systems to curb revenue leakages.
The impressive results are also pegged on active taxpayer education programmes – helping enterprises of all sizes understand tax obligations and compliance benefits and enhanced dispute resolution mechanisms – with out-of-court settlements generating significant inflows.
Mr. Mwenda emphasised that these reforms are designed to support, not penalise, taxpayers.
“We are improving services, listening to businesses and strengthening the overall business environment. This approach builds trust and encourages voluntary compliance,” he said.
What this means for Tanzania’s economy
Strong revenue performance by TRA has important implications for the wider economy:
- Financing development priorities: Reliable tax revenues are essential for funding infrastructure, education, health services and social programmes without excessive borrowing.
- Reducing dependence on external financing: Improved domestic resource mobilisation helps strengthen fiscal sovereignty and creditworthiness.
- Encouraging formalisation and growth: A predictable and fair tax environment can attract investment and foster business growth, aligning with the government’s industrialisation agenda.
According to the 2024/25 national budget framework, TRA was projected to collect about TSh 29.5 trillion in tax revenues, forming the backbone of domestic revenue efforts.
Sustained outperformance against targets in 2025/26, therefore, signals both strong economic activity and improved tax administration.
Despite the positive trajectory, TRA and government officials concede that continued progress depends on persistently broadening the tax base, improving compliance in difficult-to-reach segments of the economy and ensuring transparency in tax policy.
Commissioner General Mwenda reiterated TRA’s commitment to collaboration with taxpayers and stakeholders:
“We will continue to work transparently and professionally to build on our achievements, promote voluntary compliance and support Tanzania’s development agenda,” he emphasises As Tanzania pursues ambitious growth goals under its Dira 2050 long-term strategy, sustainable and equitable taxation will be central to financing the nation’s future – moving from dependency on external financing toward robust domestic funding.
