The Tanzania Ministry of Tourism and Natural Resources has ordered that all fees and charges in the tourism sector be paid in local currency.
According to local reports, Finance Minister, Mwigulu Nchemba, banned the use of dollars in local transactions in his 2024 / 2025 Annual Budget speech in June 2024. Consequently, all local transactions are required to be in the country’s local currency, the Tanzanian Shilling.
Payments previously paid in dollars will be converted into Tanzanian Shillings based on the Bank of Tanzania (BoT) exchange rate as the government continues to develop a permanent payment modality in collaboration with stakeholders, a notice by the ministry said.
“All tourism business operators, tour guides, individuals or institutions issued with Control Number in U.S. dollars before July 1 2024 will need to pay based on the currency specified in perspective Control Number until August 1, 2024,” the notice added.
Tanzania National Parks already switched from the use of dollars to Tanzania Shillings on July 1 2024 and directed tourist companies and other service providers to follow suit.
The move is one of the steps taken in recent months to stabilize the local currency which has lost 6% to the dollar in the last one year, with a dollar fetching 2,655 units of the local currency as of July 16 2024.
Last month [June 2024], the Bank of Tanzania began selling dollars held in its reserves to commercial banks hoping to ease a dollar shortage. The combination of a growing demand for greenbacks coupled with the shortage reportedly led to a growing black market for dollars.
During the budget speech before the Tanzanian National Assembly in June 2024, Nchemba emphasized the problems with dollarization and said that it is ‘hindering economic progress.’ He also said the situation increases ‘unnecessary’ demand for foreign currency and that it undercut those who need dollars to import essential goods into the country.
As reported by BitKE, the budget also proposed a plan to collect taxes from cryptocurrency transactions within the country.
🇹🇿REGULATION | Tanzania Looking to Amend Income Tax Act to Boost Revenue By Taxing Income From Crypto Transactions
Tanzania has outlined a proposal to amend the Income Tax Act to enable the collection of taxes from the crypto trades in the country which includes several… pic.twitter.com/NeAZsTlxp1
— BitKE (@BitcoinKE) June 17, 2024
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