IN June this year, the country witnessed a nationwide strike when traders refused to open their businesses demanding for the government to adhere to their needs. The strike began at Kariakoo market in Dar es Salaam before it spread to other regions, including Mbeya, Morogoro, Mwanza, and Ruvuma.

Their major complaint was the unbearable taxes and unfair treatment by tax officers. But this is not an unfamiliar sight, In May 2023, businessmen in Tanzania went on a boycott opposing the introduction of new regulations by the Tanzania Revenue Authority (TRA) and of course the unfair treatment that they encountered from the authority. 

And, if one zooms out of the timeline even further, 10 years ago in 2013, the traders at Kariakoo market also went on a strike to resist the introduction of Electronic Fiscal Devices (EFD) machines and unfair treatment by the tax administration.

Looking at all these strikes and boycotts in unison, a common theme emerges. It appears that unfair treatment of taxpayers by tax officers is a common cry in all strikes. It is therefore crucial to understand taxpayers' rights and what a taxpayer is entitled to when dealing with the tax authority. This article highlights some of the taxpayers’ rights as follows.

Right to fair and equitable treatment

Taxpayers have the right to be treated fairly and equitably, meaning that the tax laws should be applied to all with impartiality. The law requires that the tax laws be applied uniformly without nepotism and discrimination based on status, size, influence, or anything.

Fair treatment also extends to how taxes are assessed. Taxpayers should not face arbitrary or excessive assessments. There are multiple court cases where the taxpayer contested an unfair tax assessment, and the court ruled in favor of the company, emphasizing that the tax authority must operate within the law and ensure fairness in its assessments.

Right to information and transparency

Taxpayers' right to information is perhaps one of the basic rights enshrined in the Tax Administration Act of 2015. Section 26 of the Act imposes obligations on the TRA to timely inform the taxpayer of his tax liabilities, the applicable laws, and his rights under the law.

Taxpayers have the right to request and receive information about how their taxes are calculated. If a taxpayer is taken through an audit process, he or she has a right to be informed regarding the scope and outcome of such an audit. 

Right to appeal and review

Taxpayers' right to appeal against tax decisions believed to be incorrect or unfair is a very important safeguard to enable them to seek redress where there is disagreement with the determinations of the TRA. This is a constitutional right that is also underpinned in the Tax Revenue Appeals Act, of 2000.

A grievance against an assessment or a tax decision made by the TRA can first be challenged by way of objection to the commissioner and then appealed to the Tax Revenue Appeals Board. If the taxpayer is still dissatisfied with the Board's decision, he may appeal to the Tax Revenue Appeals Tribunal and then to the Court of Appeal of Tanzania.

Right to privacy and confidentiality

Section 21 and Section 8 of the Tax Administration Act and Tanzania Revenue Authority Act respectively, guarantees taxpayers the right to confidentiality. The law requires the TRA to maintain confidentiality for all information on taxpayers except as permitted by law or by the taxpayer himself. This protects the personal and financial information of taxpayers against unauthorized access and misuse.

For instance, the tax authorities cannot disclose the financial information of a taxpayer to a third party without justifiable reasons. Breach of this right may trigger legal action against the tax body. There are multiple instances when TRA has refrained from giving a taxpayer’s information despite pressure from the press and the public, particularly when a tax dispute becomes a national sensation.

The right to pay no more than the correct amount of tax

A Taxpayer should pay only the amount of tax legally due. When there is an overpayment, the excess shall be refunded or adjusted. Section 71 of the Tax Administration Act, enables a taxpayer to apply for refund when he has paid more than the prescribed tax. Where a taxpayer has paid excess taxes, they qualify for a refund, only that such application for refund must be made within 3 years from the day they made such a payment. The law indicates that any refund application should be determined within 90 days following the date on which the taxpayer submitted a valid claim.

Right to representation

Section 27 of the Tax Administration Act, 2015 provides that a taxpayer in dealing with the TRA may be represented by a tax consultant or an attorney. This right ensures that taxpayers are not disadvantaged by lack of expertise or knowledge in tax matters.

In complicated tax disputes, it is always advised for taxpayers to seek the services of professional tax consultants or lawyers to represent their interests before the TRA or in the courts of law. Professional representation usually makes a big difference in amicably solving tax issues at hand.

Right to timely service

Taxpayers are entitled to timely and efficient services from the TRA; this implies timely processing of tax returns, timely issuance of tax clearance certificates, and speedy resolution of tax disputes.

In practice, delays in the provision of these services can negatively affect businesses and individuals. For instance, a late tax clearance certificate would hinder businesses from engaging in government tenders or acquiring licenses. 

Right to finality in tax matters

Taxpayers have a right to certainty or finality: This means that once a tax dispute has been resolved, the taxpayer should not be subject to further assessments or reviews for the same period unless, of course, new information comes to light. Section 48 of the Tax Administration Act, 2015 limits the time within which the TRA can raise assessments, generally after five years, except in cases of fraud or misrepresentation.

In tax litigations this right is protected through the legal doctrine of res judicata, which prohibits the institution of a new case on the same matter once it has been determined by the court.

Moreover, the rights of taxpayers in Tanzania are well protected by law. These rights ensure that treatment given to taxpayers is fair, proper, transparent, and unfair tax decisions can be appealed. The application of these rights has been quite successful; however there are still some challenges which have led to clashes between taxpayers and the tax authority multiple times. It is high time for taxpayers and tax officers to re-learn of their rights and duties to prevent future clashes.

The author is an advocate of the High Court of Tanzania and a Certified Public Accountant, currently practicing tax and corporate law as an instructor at Mzumbe University.