Tanzania and Qatar signed a tax agreement on Tuesday aimed at reducing the cost and uncertainty of cross-border business, potentially making it easier for Qatari investors to expand into Tanzania's energy, infrastructure, tourism and other sectors.
The Double Taxation Agreement, signed by Tanzania's Finance Minister Ambassador Khamis Mussa Omar and Qatar's Finance Minister Ali Bin Ahmed Al Kuwari, is intended to prevent the same income from being taxed twice in the two countries.
That could give companies operating across the two markets greater clarity over their tax obligations and reduce costs associated with cross-border investment.
The agreement was signed on the sidelines of the 11th Annual Meeting of the Board of Governors of the Asian Infrastructure Investment Bank (AIIB) in Doha.
“By eliminating double taxation, this agreement will promote international trade, investment and business activities. It will also create a more transparent and predictable environment for investors,” Omar said.
For Tanzania, the agreement comes as the government seeks to attract more foreign capital into sectors including infrastructure, energy, tourism, transport and logistics, agriculture and financial services.
Omar said the pact should help create conditions for new investment while strengthening economic cooperation between the two countries.
“Tanzania views this agreement as an opportunity to attract new investment across various sectors,” he said.
The agreement also strengthens cooperation between the tax authorities of the two countries, including efforts to tackle tax evasion and tax avoidance.
That provision could become increasingly important as companies expand operations across borders, allowing the two governments to protect their tax bases while providing businesses with clearer rules.
Al Kuwari said Tanzania was an important economic partner for Qatar and that removing double-taxation barriers could encourage investment and capital flows between the two countries.
“Removing barriers related to double taxation will help create a more favourable environment for investment and capital flows between our two countries,” he said.
Qatar already has an investment presence in Tanzania through institutions including the Qatar Investment Authority and Qatar Fund for Development, which are involved in various projects in the country.
Al Kuwari said Qatar was ready to deepen cooperation with Tanzania through the exchange of knowledge and technical expertise, in addition to investment.
He also highlighted oil and gas as an area where clearer tax arrangements could support existing projects and encourage new ones involving companies from both countries.
The agreement therefore provides a tax framework at a time when Tanzania is seeking to expand foreign investment while Qatar continues to deploy capital and expertise in international markets.
Omar thanked technical teams, tax experts, legal advisers and government officials from both countries for completing the negotiations.
He said the two sides would now focus on implementing the agreement and deepening economic cooperation.