The Government of Tanzania, through the Ministry of Finance, has requested Parliament to approve a total of TZS21.3 trillion for the implementation of the Ministry’s functions and its institutions for the 2026/27 financial year.
Presenting the Budget Proposals and National Plan in Parliament, the Minister for Finance, Ambassador Khamis Mussa Omar (MP), said the funds will finance both recurrent and development expenditure across eight budget votes under the Ministry and its agencies.
He explained that the proposed budget allocates TZS19.4 trillion for recurrent expenditure, while Sh1.8 trillion is set aside for development projects aimed at strengthening economic management systems and public service delivery.
The Minister said the 2026/27 budget has been designed to support continued economic stability and growth, with the government targeting an economic growth rate of 6.3 percent in 2026.
Inflation is expected to remain stable within a range of 3 to 5 percent, supported by prudent fiscal and monetary policies.
He further noted that the government will continue strengthening discipline in public spending and improving domestic revenue collection to ensure sustainable financing of national priorities.
To address outstanding obligations, the Ministry has also planned to allocate TZS100 billion every month for the settlement of arrears owed to public servants, contractors, suppliers, and service providers.
This measure is intended to reduce the accumulation of government debts and improve trust in public financial management.
On revenue projections, the Ministry of Finance expects to collect a total of TZS55.2 trillion from various sources. The Tanzania Revenue Authority (TRA) is projected to contribute more than Sh39 trillion, reflecting continued efforts to expand the tax base and enhance compliance.
In another key allocation, Parliament has been requested to approve TZS132.2 billion for the National Audit Office to strengthen oversight of public funds and continue expanding its infrastructure, including construction of regional offices in selected areas across the country.
The Minister stated that the budget has been prepared in line with Tanzania’s Development Vision 2050, the Fourth Five-Year Development Plan, and the ruling party’s 2025 election manifesto, ensuring alignment between national priorities and long-term development goals.
Regarding the performance of the 2025/26 budget, the Minister reported that Parliament had originally approved Sh20.18 trillion for recurrent and development expenditure across eight votes of the Ministry.
Out of this amount, Sh19.43 trillion was allocated for recurrent expenditure, including Sh1.10 trillion for salaries and Sh18.33 trillion for other operational costs.
Development expenditure was set at TZS747.30 billion, with domestic funding accounting for TZS601.70 billion and foreign funding at Sh145.60 billion.
During the mid-year review, the budget was revised downward to TZS19.94 trillion. Of this revised amount, Sh19.45 trillion was for recurrent expenditure and TZS485.99 billion for development projects.
By the end of April 2026, the Ministry had received TZS14.08 trillion, equivalent to 70.63 percent of the revised budget. Actual expenditure stood at TZS14.05 trillion, representing 99.76 percent of the funds received, indicating high absorption levels.
The Ministry also reported progress in revenue collection and economic management. Between July 2025 and April 2026, the government mobilised TZS41.37 trillion from domestic and external sources, achieving 82.4 percent of the annual target.
During the same period, TZS9.74 trillion was used for debt servicing, with Sh4.45 trillion allocated to external debt and TZS5.29 trillion to domestic debt.
The government noted that timely debt repayment has strengthened Tanzania’s credibility in regional and international financial markets.
In a notable achievement, Tanzania was recognized as the overall winner in public debt management among Commonwealth countries and also received an award for best government debt management office in Africa.
On economic performance, the country recorded an average growth rate of 5.9 percent in 2025, up from 5.5 percent in 2024.
The growth was driven by increased private sector credit, improvements in infrastructure, expansion of agricultural activities, mining, construction, and implementation of major strategic projects.
Inflation remained stable at an average of 3.4 percent, while foreign exchange reserves rose to 5.723 billion US dollars, sufficient to cover more than 4.4 months of imports of goods and services.
The government said these macroeconomic indicators reflect continued resilience and stability of the national economy, supported by ongoing reforms in fiscal management, investment promotion, and infrastructure development.
