If you
aspire to invest in Tanzania economic zones, there are two investment
schemes readily available for you—the Export Processing Zones (EPZ) and
Special Economic Zones (SEZ). Both schemes provide conducive environment
for profitable operations.
The incentives
offered to operators in both schemes compare favorably with the most
attractive elsewhere in the world and are the best in the region.
Special
Economic Zones
The Government
of Tanzania established Special Economic Zones (SEZs) in 2006 as strategy to
achieve mini-tiger plan 2020, the objective being to promote quick and
significant progress in economic growth, export earnings and employment
creation as well as attracting private investment in the form of both
Foreign Direct Investments (FDI) and Domestic Direct Investment (DDI) from
all productive and service sectors.
A special
economic zone is a geographical area that has more liberal economic laws
than the country’s typical laws. It is an economic development tool to
promote rapid economic growth by using fiscal and business incentives to
attract investments and technology.
The zones act
as a magnet for investment in desirable activities in specially designated
areas by providing quality infrastructure, complemented by an attractive
fiscal package, business support services, cluster formation and minimal
regulations.
The SEZ
programme covers a wider range of allowable activities than the EPZ. It is,
therefore, envisaged that the SEZ programme will go a long way in
contributing towards the achievement of economic objectives and goals of
Vision 2020 aiming at transforming Tanzania into a globally competitive
country. Special economic zones include:
• Export
Processing Zones
• Free ports
• Free Trade
Zones, Industrial Parks
• Regional
Headquarters
• Science and
Technology parks
• ICT Parks
• Agricultural
Free Zones
• Tourism
Development Zones and Business Incubation
• Special
Economic Zones Act 2006 (Download)
Investors under
Special Economic Zones scheme are entitled with a pack of lucrative
investment incentives according to the nature of investment operation. The
Special Economic Zones Act 2006 categorizes these incentives into three
categories.
a) Category A:
Infrastructure Development
• Exemption
from payment of taxes and duties on all capital goods related to EPZs/SEZs
• Exemption
from corporate tax for 10 yrs.
• Exemption
from withholding tax on rent, dividends and interests for 10 years.
• Exemption
from payment of property tax for 10 years.
• Exemption
from VAT on utility charges.
• Exemption
from pre-shipment or destination inspection requirements etc.
• Remission of
custom duty, VAT and other taxes on raw materials and goods of capital
nature related to production in zone.
• Exemption
from payment of withholding tax on interest on foreign sourced loan.
• Exemption
from pre-shipment or destination inspection requirements.
• On site
inspection of goods in the Zone.
• Unconditional
transferability of profits, dividends, loyalties, etc.
• Provision of
visa at the point of entry to key personnel.
• One stop
service centre in the zone.
• Exemption
from corporate tax for 10 yrs.
• Exemption
from withholding tax on rent, dividends and interests, for 10 years.
• Remission of
custom duty, VAT and other taxes on raw materials and goods of capital
nature related to production in EPZs.
• Exemption
from taxes and levies imposed by Local Government Authorities on products
produced in EPZs.
• Exemption
from VAT on utility and wharfage charges.
• Exemption
from pre-shipment or destination inspection requirements.
• Unconditional
transferability of profits, dividends, loyalties, etc.
• Lower port
charges compared to other cargo box rate (for EPZs)
• Accessing the
export credit guarantee scheme (for EPZs).
• On site
customs inspection in the Zones.
• One stop
service centre in the zone.
Any investor
can qualify to invest under Special Economic Zone Scheme provided he
fulfills only these simple criteria.
• The
investment must be new.
• Annual export
turnover should not be less than US$ 5million for foreign investors and US$
1million for local investors.
• Adequate
environmental protection systems.
• Utilization
of modern production process and new machinery.
• Investments
must only be located in SEZ industrial parks.
Investors
interested in locating their business under Special economic Zone scheme are
only required to follow a few simple steps.
-
Investor makes an inquiry on the program and how it operates, either through visiting our headquarters offices or via online through our website
-
Submission of investment proposal detailing the type of business to be conducted, type of goods to be produced or processed, production volume, markets, location where the business is intended to be carried on and production process intended to be used
-
EPZA evaluates the project and provides to investor a letter of approval within 14 days.
-
Investor incorporates SEZ Company, locates a zone, obtains an environmental approval certificate if required
-
For stand alone and Zone developers, EPZA facilitates declaration of land by Minister for Industry, Trade and Marketing.
-
Investor pays license fees and gets license, once the company posses an SEZ license he does not require any additional paper works to start operations.
-
Investor begins operations.
