Tanzania injects Sh298bn to offset donor health cuts

Dar es Salaam. The government has allocated $114 million (approximately Sh298 billion) for the 2024/25 and 2025/26 financial years to strengthen the procurement of medicines and medical supplies aimed at combating tuberculosis, HIV/Aids and malaria.

The decision comes amid a decline in donor support for critical disease interventions and was announced by the Chief Government Medical Officer, Dr Grace Magembe, during a Global Fund budget review session held in Dodoma on July 21, 2025.

“You may recall that recently, some donor countries reduced their funding for efforts aimed at combating tuberculosis, HIV/Aids and malaria in the country. However, the government promptly provided $54 million, equivalent to Sh140 billion, for the 2024/25 financial year,” said Dr Magembe.

She added that for the 2025/26 financial year, the government has raised its allocation to $60 million (Sh159 billion) to bridge the funding gap left by development partners.

“This increase aims to enhance healthcare services for all citizens, with a particular focus on vulnerable groups affected by these diseases,” Dr Magembe said.

The high-level meeting brought together stakeholders from government ministries and international partners, including representatives from the Prime Minister’s Office, the President’s Office for Regional Administration and Local Government, the Ministry of Finance, and the Ministry of Health.

Also in attendance were officials from the U.S. Embassy, the World Health Organization, the Tanzania National Coordinating Mechanism (TNCM), and the Local Fund Agent (LFA). The session focused on aligning available resources with community health priorities.

Dr Magbembe said in February, 2025, shortly after US President Donald Trump announced a suspension of USAID-funded programmes including those targeting HIV/AIDS.

She said that the matter was being handled by a task force under the Prime Minister’s Office.

Presenting the 2025/26 budget estimates in the Parliament last month (June), Finance Minister Dr Mwigulu Nchemba said the government expects to raise Sh586.4 billion from new domestic sources to bolster the fight against HIV/AIDS and support the Universal Health Fund (UHF), following significant cuts in international aid.

“Under these new fiscal measures, 70 percent of the additional revenue generated will be allocated to the AIDS Trust Fund, while 30 percent will support the Universal Health Fund,” Dr Nchemba told the Parliament last month.

To meet the target, the government has increased excise duty on alcoholic beverages by adding Sh20 per litre on beer, Sh30 per litre on wine and Sh50 per litre on spirits.

Excise duty on electronic communication services has also risen slightly from 17 percent to 17.5 percent.

Additional revenue will be raised through new and increased levies in multiple areas: Sh10 per litre fuel levy on petrol, diesel, and kerosene, 0.1 percent levy on the gross market value of minerals, increased winning tax on sports betting (from 10 percent to 15 percent), increased winning tax on land-based casinos (from 12 percent to 15 percent).

Furthermore, new levies will be introduced on imported vehicles and heavy machinery, varying based on engine capacity, alongside a Sh500 levy on train tickets and a Sh1,000 levy on air transportation tickets.