Title: An Analysis Of Legal Inconsistencies In The Implementation Of The Virtual Fiscal Management System (Vfms) In Zanzibar's Tax Regime
Authors: Omar Suleiman Sultan and Mzee Mustafa Mzee
Volume: 10
Issue: 1
Pages: 18-23
Publication Date: 2026/01/28
Abstract:
The Revolutionary Government of Zanzibar has been struggling to enhance revenue collection using various means and mechanisms. Different measures have been taken to realize that dream. One among them was to collect taxes through electronic means. The government through Tax Administration and Procedure (Virtual Fiscal Management System) Regulations, 2021 introduced Virtual Fiscal Management System where tax collection is to be affected through VFD. Through this system, taxpayers must pay their required taxes electronically using Virtual Fiscal Devices. This paper assess whether is there any legal challenges associated with the introduction of VFMS in Zanzibar. The paper employed doctrinal legal research to analyse the law of VFMS. The paper reveals that, the introduction of this law has brought some of legal challenges including silence of the law on threshold for those who are required to use VFMS, law is silent on classification of taxpayers who required to use VFMS, the law gives power to the Commissioner without liability and the use of english language in the VFMS regulation which is not common language for some of taxpayers. The paper recommends enacting a regulation to determine tax threshold for VFMS users, imposing obligations on the ZRA to repair VFD machines within a specific time and translate VFMS regulations into Swahili.