TIN display rule excludes non-resident traders, TRA says

DAR ES SALAAM: THE Tanzania Revenue Authority (TRA) has moved to clarify its requirement for traders conducting business on social media to display their Taxpayer Identification Number (TIN), saying the rule applies to businesses operating in Tanzania and does not automatically cover every online seller.

The requirement has been in effect since July 1 this year, following changes to tax regulations governing how businesses register and identify themselves for tax purposes.

Speaking to the Daily News, TRA Taxpayer Education Manager Paul Walalaze said the regulation applies to any person conducting business through social media, regardless of the type or size of the business.

He said, however, that the requirement does not automatically cover everyone who uses the internet for business, particularly traders or service providers who are not residents of Tanzania and are therefore not required to hold a Tanzanian TIN.

“The requirement, however, does not automatically cover every person who uses the internet for business. Some people operate through these platforms but are not residents of Tanzania.

“Therefore, they cannot be required to display a TIN because they may not be required to have a TIN in Tanzania. The residential status of the trader or service provider is therefore relevant,” he said.

Under the regulation, businesses operating through social media platforms are required to visibly display their TIN, TIN Certificate or Tax Clearance Certificate on their business accounts.

Mr Walalaze said the requirement applies regardless of whether a business operates from a home or commercial premises.

“As long as a person is carrying on business, they are required to formalise the business by obtaining a business TIN and comply with the applicable tax obligations,” he said.

For many Tanzanians, social media has become more than a platform for communication and entertainment, with traders increasingly using it to market and sell clothes, food, cosmetics, electronics and other goods and services. The growing trend has now attracted the attention of tax authorities.

The requirement has sparked debate, with reactions ranging from privacy concerns to support for greater transparency in online businesses.

Online mobile phone seller Richard Kadillo said the requirement could improve transparency and boost customer confidence.

“Displaying a TIN on a business profile can help build confidence in online businesses,” he said.

However, online women’s clothing seller Irene Nicholaus raised concerns that publicly displaying tax information could expose personal and business details to misuse.

“I think there is a need for proper advice and guidance on data, including data privacy. I am not sure how sensitive a TIN is when it is displayed on social media, although physical shops normally display their TINs and business licences on their premises,” she said.

Responding to the concerns, Mr Walalaze said TRA recognised the issues raised but maintained that displaying a Business TIN or Tax Clearance Certificate, as prescribed by the regulations, did not in itself constitute an infringement of personal data protection.

“TRA protects taxpayer information in accordance with the Tax Administration Act and applicable data protection laws, while taxpayers are only required to display the information prescribed under Regulation 58(2),” he said.

On implementation, Mr Walalaze said TRA was initially focusing on taxpayer awareness, education and voluntary compliance while identifying businesses conducting commercial activities through social media.

“As this is a new requirement, TRA will continue engaging taxpayers to ensure that affected businesses understand and comply with their obligations,” he said.

He said several implementation challenges had emerged, including gaps in awareness, uncertainty over who is covered, questions about how to display the required information and concerns over privacy.

On enforcement, Mr Walalaze said failure to display the required information constituted noncompliance, and TRA could require affected businesses to regularise their position or take appropriate action under applicable tax laws.

“The regulations do not prescribe a specific penalty for failure to display the required information. However, non-compliance may constitute a general offence under Section 93 of the Tax Administration Act, with sanctions depending on the circumstances of the case,” he said.