Zanzibar Business Licence: Who Issues It, How Renewal Works and Why the Mainland Licence Does Not Reach the Isles

This guide explains how a Zanzibar business licence is obtained and renewed. It covers the law in force, the councils and the new Authority, and sector licences from the Zanzibar Commission for Tourism and ZFDA. It then covers tax registration with ZRA at 15% VAT, ZIPA for investors, renewal and penalties, and a costed example of a foreign-owned consultancy in Zanzibar City.

Who should read this

• Founders opening a shop, office or service business in Unguja or Pemba.
• Mainland companies expanding to Zanzibar that assume their BRELA or TAUSI licence travels with them.
• Foreign investors weighing a ZIPA certificate against a plain company and council licence.
• Hotel, restaurant and tour businesses that need a tourism licence on top of the trading licence.
• Finance teams that must budget renewals, VAT and levies under ZRA rather than TRA.

Readers who have not yet incorporated should start with our guide to registering a company in Zanzibar with BPRA, not BRELA. Registration comes first; the licence follows.

What the law says

Business licensing is not a Union matter. The Mainland and Zanzibar each run their own system. On the Mainland, the Business Licensing Act, Cap. 101 R.E. 2023, governs. In Zanzibar, three layers of law apply.

The licensing statute changed recently. The Bill for the Zanzibar Business Licensing Management and Regulatory Act, 2024 appeared in Gazette No. 7291 on 5 November 2024. Section 4(1) establishes the Business Licensing Management and Regulatory Authority. Section 57(1) repeals the Business Licensing Regulatory System Council Act, No. 13 of 2013, which created the old Council, known as BLRC.

The Authority runs a live website at blrasmz.go.tz, which indicates it is operating. We could not read the assented Act, its number or its commencement date, so those are in our list of figures to confirm. Section 1 of the Bill brings it into force on the President's assent.

Who issues a business licence in Zanzibar?

For an ordinary trading or service business, the issuer is the local council where the premises sit. Zanzibar has city, municipal, town and district councils on Unguja and Pemba. The Magharibi "A" Municipal Council licence page sets out a typical council process.

1. Register at the council revenue office. Bring the BPRA certificate or business name certificate and, for a company, the memorandum and articles showing the activity.
2. Show suitable premises. The site must suit the activity; roadside stalls are excluded.
3. Provide the TIN certificate. A copy of the taxpayer identification certificate is required.
4. Add professional or sector proof. The council asks for professional certificates and sector registrations, such as ZFDA for food and drugs or a fire certificate for a gas shop.
5. Pass the inspection. A business assessor and a health officer inspect the premises.
6. Pay against a control number. The council assesses the fee for the business type and issues a control number for payment.
7. Collect the licence. Return the receipt with a passport photo and ID copy, and collect the licence.

Above the councils sits the new Authority. Under section 21 of the 2024 Bill, it publishes a gazetted list of licensing authorities. A body not on that list may not issue a licence to establish a business. Section 25(2) bars discrimination on grounds that include nationality.

The Bill also sets service clocks. Section 23 gives 30 working days to process an application. Section 37 requires issue within three working days once the applicant complies. Section 28 requires a refusal notice within three working days.

Does a Mainland business licence work in Zanzibar?

No. A licence from BRELA on the Tanzania National Business Portal or from a Mainland council on TAUSI covers premises on the Mainland. Cap. 101 is Mainland law, and its fee schedule has no Zanzibar rows. A business with a shop in Dar es Salaam and another in Stone Town holds two licences under two systems.

The company itself may also need to change. In 2021 Zanzibar amended section 238 of its Companies Act, No. 15 of 2013. Bowmans (6 October 2021) report that Mainland companies were required to operate through a Zanzibar subsidiary instead of a branch. The subsidiary needs its own TIN. Our guide on Mainland vs Zanzibar company setup covers the structure choice.

One exception needs care. The Zanzibar Minister for Trade told the House of Representatives in the 2023/24 budget speech that industrial licences and their statistics are Union matters. A manufacturer should confirm with BRELA and the Zanzibar Ministry whether a Union industrial licence applies, on top of the council licence.

Which sector licences sit on top of the council licence?

Registration is not permission to trade, and a council licence is not permission to run a regulated activity. Each regulated sector has its own Zanzibar regulator.

Tourism. The Zanzibar Tourism Act, No. 6 of 2009, requires a licence from the Commission before a tourism business operates. Cymbell Attorneys (18 July 2023) report that, from a July 2023 notice, Commission licences run 12 months from the date of issue, not to the calendar year end. Our guide to Zanzibar tourism licensing layers and our note on tourism setup in Zanzibar vs the Mainland cover the classes.

Food and drugs. The ZFDA was established under the Zanzibar Food, Drugs and Cosmetics Act, as amended by Act No. 3 of 2017. Its mandate covers food, drugs, cosmetics and medical devices, and it keeps a register of premises. A TMDA permit does not cover Zanzibar; see ZFDA, not TMDA.

What does a Zanzibar business licence cost?

Zanzibar licence fees are not in our fee register, which covers Mainland fees under Cap. 101 and other Mainland instruments. We did not find a current official Zanzibar council fee schedule online that we could verify. The council assesses the charge on filing, by business type and location.

The Magharibi "A" page states that the fee depends on the business type and is set under the council's regulations. Payment is against a control number, and the council issues a receipt. A secondary source from 2022 cites the Zanzibar Business Licence Regulations, 2017, and a hotel licence fee. We have not verified those Regulations against the Gazette, so we do not repeat the figure.

Budget for these separate government charges, each paid at the official rate:

• The council business licence, as assessed.
• Any sector licence, such as the Commission for Tourism or ZFDA.
• BPRA registration and annual filing fees, set by BPRA.
• ZIPA fees, if the project applies for a Certificate of Investment.

Ask the council for the written assessment before signing a lease. Fees for a foreign-owned business are a common question, and only the council can answer it for its area.

Tax registration: TIN, ZRA and VAT at 15%

A Zanzibar business usually deals with two revenue bodies. Income tax is a Union tax collected in Zanzibar by the TRA Zanzibar office, which issues the TIN. The Zanzibar Revenue Authority administers VAT, hotel levy, restaurant levy, tour operation levy, stamp duty and other Zanzibar taxes. ZRA was established under the ZRA Act, No. 11 of 2022, replacing the Zanzibar Revenue Board.

The ZRA VAT page gives these points:

• Rate: 15% on taxable supplies of goods and services in Zanzibar, against 18% on the Mainland.
• Threshold: taxable turnover of TZS 100 million and above, against TZS 200 million on the Mainland.
• Hotels: registration applies where the accommodation rate is at least USD 100 per person per night, bed and breakfast.
• Law: the page names the Value Added Tax Act, No. 4 of 1998 (Zanzibar).

PwC Worldwide Tax Summaries (reviewed 9 September 2026) confirm the 15% rate and TZS 100 million threshold, with 18% for some services such as banking and telecommunications. Our guide to the Zanzibar VAT rate and threshold covers registration and returns.

ZIPA and foreign-owned businesses

ZIPA is the Zanzibar investment authority. On the Mainland, the investment authority is TISEZA, which replaced TIC from 1 July 2025. A TISEZA certificate does not cover a Zanzibar project.

The Zanzibar Investment Act, No. 10 of 2023 repealed the 2018 investment Act. The House passed it on 4 December 2023, and it came into force on assent in 2024. Section 24 links the Certificate of Investment to criteria in the Second Schedule, which sets minimum invested capital.

Older guides still quote USD 300,000 for foreign investors. The Zanzibar eRegulations ZIPA page still cites the 2018 Act and USD 300,000. That is the repealed position; rely on the 2023 Act and confirm with ZIPA.

The 2023 Act does not list activities reserved for Zanzibaris. Section 37 gives Zanzibaris priority in hiring where they hold the qualifications. Mainland reservations under GN 487A of 2025 are made under Cap. 101 and do not apply in Zanzibar. Sector laws and council practice may still restrict foreigners in some activities, so ask the regulator before you invest. Our guide to ZIPA incentives and economic zones covers the certificate.

How does renewal work, and what happens if you are late?

Council licences in Zanzibar commonly follow the calendar year. The Magharibi "A" page states that a licence runs 12 months, from January to December. It also states that the holder has five months to pay without a fine. Renewal needs a copy of the expired licence.

Other licences follow their own clocks. Commission for Tourism licences run 12 months from issue. Section 18 of the 2024 Bill classes licences as valid for 12 months or more, and permits for less than 12 months. Section 38(2) keeps a licence in force while a renewal application is pending, and until any appeal is decided.

The penalty for late renewal or trading without a council licence is set by council rules, not by Cap. 101. The council page implies a fine after the five-month window but does not state the amount. As published, the 2024 Bill's fines in section 51 target licensing authorities that issue licences outside the system, not traders. Treat the trader penalty as unknown until the council confirms it in writing.

For the Mainland renewal rules, which differ, see our guide to business licence renewal in Tanzania.

Mainland vs Zanzibar: how do the two licensing systems compare?

Register IDs appear only for Mainland lines. Zanzibar has no lines in our register.

Our Mainland business licensing guide explains Class A and Class B in full.

Worked example: a foreign-owned consultancy opens in Zanzibar City

Bahari Advisory Limited is a hypothetical company. A Kenyan investor holds 60% and a Zanzibari partner 40%. It plans a business consultancy office in Stone Town, and a second office in Dar es Salaam. It expects TZS 150 million in fees in year one in Zanzibar.

Step 1: the Zanzibar company. The group incorporates Bahari Advisory in Zanzibar with BPRA under the Companies Act, No. 15 of 2013. BPRA fees are set by BPRA and are not in our register.

Step 2: TIN and ZRA. The company obtains its TIN at the TRA Zanzibar office and registers with ZRA. Expected turnover of TZS 150 million is above the TZS 100 million threshold, so VAT registration follows.

Step 3: the council licence. The company applies to the council for the Stone Town premises, which assesses the fee on filing. Payment is against the council's control number. The licence runs to 31 December.

Step 4: ZIPA. A foreign or joint consultancy needs at least USD 500,000 of invested capital for a Certificate of Investment. Bahari plans USD 150,000, so it does not qualify. Whether a foreign-owned business below the threshold may trade on a council licence alone is not settled in published sources. Bahari asks ZIPA in writing before opening.

VAT on one invoice. On a TZS 10,000,000 Zanzibar fee, VAT at 15% is TZS 1,500,000, for a total of TZS 11,500,000. The same fee billed from Dar es Salaam carries 18%, or TZS 1,800,000.

The Dar es Salaam office. Non-citizens hold more than 50%, so the company is foreign owned under Cap. 101 (NEW-08-13). The council licence for business consultancy is USD 2,000 for the principal place (F0860). If renewed 40 days late, the penalty is 25% of the unpaid fee, or USD 500, on top of the fee (F0881).

The USD and TZS figures are kept apart and are not added together.

What to do now

1. Confirm the jurisdiction of each site. List every premises and mark it Mainland or Zanzibar.
2. Register in Zanzibar first. Incorporate or register the business name with BPRA, and check the subsidiary rule for Mainland groups.
3. Obtain the TIN and ZRA registration. Register with TRA Zanzibar for the TIN and with ZRA for VAT and levies.
4. Ask the council for an assessment. Get the fee and document list in writing before you sign a lease.
5. Add the sector licence. Apply to the Commission for Tourism, ZFDA, ZBS or the professional board where the activity needs it.
6. Decide on ZIPA. Check the 2023 Act thresholds and ask ZIPA whether your project needs a certificate.
7. Diary the renewals. Record the council year end, the grace period and each sector licence anniversary.

Key dates and deadlines

How Zatra helps

Zatra's business licensing service prepares the BPRA, TRA, ZRA and council files for a Zanzibar business. We map the sector licences and keep a renewal calendar for both sides of the Union. For groups with sites on both sides, we run the Mainland and Zanzibar files side by side.

Costs come in two separate buckets. Government fees are paid at the official rate to the council, BPRA, ZRA, ZIPA or the sector regulator, against each authority's control number. Zatra's professional fee is quoted on its own line and never mixed with them.

The council, the Authority and each regulator decide every application. Zatra prepares and coordinates, but does not decide or guarantee any authority's outcome. Appeals, prosecutions, disputes over a refusal and formal legal opinions go to an advocate.

Sources and status

Accurate as at 31 October 2026.

• Bill for the Zanzibar Business Licensing Management and Regulatory Act, 2024: Zanzibar Government Gazette No. 7291, House of Representatives, 5 Nov 2024. Accessed 31 Oct 2026.
• Leseni ya biashara: Magharibi "A" Municipal Council, page live 2026. Accessed 31 Oct 2026.
• Budget speech of the Minister for Trade and Industrial Development, 2023/24: House of Representatives, 2023. Accessed 31 Oct 2026.
• Zanzibar Investment Act, No. 10 of 2023: FAOLEX copy of the Act, 2024. Accessed 31 Oct 2026.
• Value Added Tax and About ZRA: Zanzibar Revenue Authority, pages live 2026. Accessed 31 Oct 2026.
• About ZFDA: Zanzibar Food and Drug Agency, page live 2026. Accessed 31 Oct 2026.
• ZIPA services for investors: Zanzibar eRegulations, ZIPA, page live 2026. Accessed 31 Oct 2026.
• Business Licensing Management and Regulatory Authority: Revolutionary Government of Zanzibar, site live 2026. Accessed 31 Oct 2026.
• Mainland companies with operations in Zanzibar: Bowmans, 6 Oct 2021. Accessed 31 Oct 2026.
• Issuance of licence for tourism business in Zanzibar: Cymbell Attorneys, 18 Jul 2023. Accessed 31 Oct 2026.
• Tanzania: other taxes: PwC Worldwide Tax Summaries, reviewed 9 Sep 2026. Accessed 31 Oct 2026.
• Zatra fee register, Mainland fees at 26 Sep 2026; line IDs as cited in the text, 2026. Accessed 31 Oct 2026.

Figures to confirm before you act

• Licensing Act: the assented Act's number, date of assent and commencement, and any changes from the 2024 Bill
• Council fees: the current fee schedule of the council for your premises, and any foreign-owned rate
• Late payment: the council fine after the five-month grace period, and whether other councils use the same window
• Licensing authorities list: the gazetted list under section 21 of the Act
• ZIPA: whether a foreign-owned business below USD 500,000 may trade on a council licence alone, and ZIPA's fees
• VAT law: the current Zanzibar VAT Act number; the ZRA page names Act No. 4 of 1998
• Industrial licence: whether a Union industrial licence applies to a Zanzibar factory
• Tourism Act: the current consolidated text of the Zanzibar Tourism Act, No. 6 of 2009, and Commission fees

This article is general information based on official sources available at the date of publication. It is not legal, tax or financial advice. Laws and notices change. Verify with the issuing authority or consult Zatra before acting.