Dar es Salaam, July 1 -- THE 2025/26 National Budget introduced a withholding tax of 10 per cent on companies retained earnings, which sent panic waves across all the country raising concerns on various issues including double taxation and a limitation of growth for corporates.

Previously, the tax was to be levied on a six-months basis, however, following discussions with stakeholders, the timeline was extended to twelve months after the close of the financial year, giving room to companies to put their affairs in order.

What are Retained Earnings and Rationale for the Tax Retained earnings are the accumulated profits a company has kept from previous financial reporting periods, rather than distributing them to investors as dividends. T...