BoT warns on use of forex in payments

BANK of Tanzania (BoT) has reminded the general public that the directives prohibiting domestic payments for goods and services using foreign currencies remain intact.

A statement issued pn Tuesday to that effect comes after the Central Bank recently observed violations of the government’s directives.

“Therefore, the BoT would like to remind the general public that the government’s directives issued are still valid and should be adhered to at all times,” the BoT said in the statement issued in Dodoma.

In August 2007 and December 2017, the government issued a public notice prohibiting domestic payments for goods and services using foreign currencies between residents of Tanzania. It said the directives remain intact even now.

The statement said further that all prices of goods and services in the country should be quoted in shillings.

These pertain to rent for land, housing and offices, fees for education, medical services, equipment and reagents, transport, logistics and port services; electronic equipment and telecommunication services.

The prices to be paid by tourists or non-resident customers may be quoted and paid in foreign currency. These include services such as accommodation, travel, airport and visa, transit trade and cargo handling.

The statement said tourists and non-residents who pay in foreign currencies must provide their identification documents such as passports and certificates of incorporation for companies for proper capturing and classification of statistics.

The exchange rate which will be used for making the payment therein above should be displayed and should not exceed the prevailing market exchange rate.

“Any resident of Tanzania should use only shillings and not be forced or obliged to make payment to another resident of Tanzania for any good or service in foreign currency,” the statement said, adding that institutions registered to determine exchange rates are commercial banks and bureaux de change only.

The Central Bank also reminded the public that section 26 of the Bank of Tanzania Act 2006 stipulates that the shilling is the only legal tender in the country and that any act of refusing payment in Tanzanian shilling amounts to a violation of the Bank of Tanzania Act 2006.