Online sellers under scrutiny as TRA tightens digital tax compliance

“We are seeing a rise in businesses that operate entirely online, some renting out homes through Airbnb, others selling goods via Instagram, or creating content for streaming platforms. While many are flourishing, not all are fulfilling their tax obligations,” he said.

To address this, TRA has introduced new strategies to identify both registered and non-compliant online businesses.

As part of a nationwide initiative, TRA officers have undergone training to trace income-generating activities online and ensure all digital enterprises contribute fairly to the national economy.

Mr Mwenda said TRA has granted a one-month grace period, starting August 1, 2025, during which unregistered digital entrepreneurs can voluntarily register and begin paying taxes without facing penalties.

“Failure to register after a one-month grace period is an offence according to the law, and they will be liable to a penalty. However, there will be no penalty during this one month because it is a capacity-building period,” he said.

“The campaign targets individuals earning income through Airbnb, home-based online stores, and content creators using global digital platforms,” he added, calling on traders in both Mainland Tanzania and Zanzibar to present themselves for registration and pay taxes in line with their earnings.

TRA digital economy manager, Mr Erick Mabula, noted that digital business owners have yet to register voluntarily, despite growing earnings.

“After August, if you’re found operating without a Taxpayer Identification Number (TIN) or failing to pay taxes, you will face legal consequences,” he warned.

He added that the campaign is particularly focused on individuals renting out homes or rooms via platforms like Airbnb, selling products through Instagram, Facebook, or WhatsApp, and running home-based delivery businesses, especially those earning over Sh4 million annually, even without a physical shop.

“Many of these entrepreneurs do not issue Electronic Fiscal Device (EFD) receipts, yet doing so is a legal requirement for any business collecting VAT (value added tax). TRA is working to educate them about their obligations while offering support for registration and tax compliance,” explained Mr Mabula.

In addition to these outreach efforts, TRA is partnering with local government authorities to help identify online businesses operating within their jurisdictions.

“Local leaders are vital partners in this effort, as they possess detailed knowledge of residents and local economic activities,” he said.

“This is about fairness. We’re not here to punish; we’re here to level the playing field. If you’re making money, especially through international platforms, you have a responsibility to pay your fair share, just like everyone else,” he said.

He added that TRA will launch a nationwide campaign in early August, featuring mobile registration centres, tax education drives, and targeted outreach in urban and peri-urban areas, noting that once the grace period ends, enforcement actions will follow.

“We want to support the growth of digital businesses in Tanzania, but that growth must go hand-in-hand with responsibility,” said Mr Mabula.

Dar es Salaam Traders Chairman, Mr Yuduph Yenga, welcomed the move, saying that all traders, whether online or operating physical shops, fall under the same umbrella and should be treated equally in terms of tax obligations.

“TRA needs to broaden the tax base so that the burden is shared more fairly. Right now, about four million people are carrying the load for many others. The solution is to expand the tax net so everyone pays their fair share,” he said during a telephone interview.