The Production Development Funds Act

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.425
CHAPTER 125
THE PRODUCTION DEVELOPMENT FUNDS ACT
[PRINCIPAL LEGISLATION]
Arrangement of Sections
Section Title
1. Short title.
2. Interpretation.
3. Establishment of funds.
4. Sources of funds.
5. Management of funds.
6. Accounts and audit.
7. Power of Minister to reallocate moneys in funds.
8. Act to apply notwithstanding any other written law.
SCHEDULE

t of funds.
6. Accounts and audit.
7. Power of Minister to reallocate moneys in funds.
8. Act to apply notwithstanding any other written law.
SCHEDULE

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.426
CHAPTER 125
THE PRODUCTION DEVELOPMENT FUNDS ACT
An Act to provide for the establishment of production development funds
and the management of the funds. [1st July, 1974]
[s. 1]
Acts Nos. 21 of 1974
9 of 1977
25 of 1980
16 of 1983
GNs. Nos. 40 of 1975
53 of 1975
27 of 1976
5 of 1983
213 of 1991
1. This Act may be cited as the Production Development Funds
Act. 2.

1980
16 of 1983
GNs. Nos. 40 of 1975
53 of 1975
27 of 1976
5 of 1983
213 of 1991
1. This Act may be cited as the Production Development Funds
Act. 2.

In this Act, unless the context otherwise requires-
“financial year” shall have the same meaning as ascribed to
it under the Public Finance Act;
“Fund” means a Production Development Fund established
by or under this Act;
“Minister” means the Minister responsible for finance;
“parastatal organisation” means-
(a) a body corporate established by or under any Act other
than the Companies Act;
(b) a trade union registered under the Trade Unions Act;
(c) a company registered under the Companies Act not
less than fifty per centum of the issued share capital
of which is owned by the Government or a parastatal
organisation or, where the company is limited by
guarantee, a company in respect of which the amount
that the Government or the parastatal organisation
which is a member of that company has undertaken to
contribute in the event of the company being wound up
is not less than fifty per centum of the aggregate amount
which the members have undertaken to contribute; and
references in this paragraph to a parastatal organisation
include references to any company. Short title
Interpretation
Cap. 348
Cap. 212
Cap. 244
Cap. 212

ences in this paragraph to a parastatal organisation
include references to any company. Short title
Interpretation
Cap. 348
Cap. 212
Cap. 244
Cap. 212

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.427
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
3.–(1) There are hereby established production development
funds specified in the first column of the Schedule for
purposes specified opposite thereto in the second column of
the Schedule. (2) A Fund shall be managed by the parastatal organisation
specified in relation thereto in the third column of the Schedule.

column of
the Schedule. (2) A Fund shall be managed by the parastatal organisation
specified in relation thereto in the third column of the Schedule.

(3) The Minister may by order in the Gazette, amend the
Schedule so as to establish production development funds in
addition to those specified by or under this Act or amend any
of the particulars in any of the columns in the Schedule:
Provided that-
(a) a Fund shall not be established under this subsection-
(i) unless in the opinion of the Minister, the
establishment of the fund shall significantly
contribute to enhancement of the productive
capacity of the United Republic;
(ii) for any purpose other than-
(aa) the financing, whether by way of loan or
equity of fixed investment by a parastatal
organisation engaged in the production of
goods or services;
(bb) the financing, whether by way of loan or grant
of research by or for the benefit of parastatal
organisations or other institutions engaged in
the production of goods or services;
(cc) the financing, whether by way of loan or
grant of the training of citizens of the United
Republic by or for the benefit of parastatal
organisations or other institutions engaged in
the production of goods or services, including
the provision of buildings, equipment and
ancillary facilities reasonably necessary for
the carrying out of the training programme;
(b) a person other than a parastatal organisation shall not be
charged with the management of any Fund established;
(c) An order made under this subsection shall be
submitted for approval, to be signified by resolution of
Establishment of
funds

any Fund established;
(c) An order made under this subsection shall be
submitted for approval, to be signified by resolution of
Establishment of
funds

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.428
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
the National Assembly within four weeks of the order
being made or, where the National Assembly is not
meeting or does not meet within the period, at its next
meeting and unless the order is approved, that order
shall expire and any fund established pursuant thereto
shall be wound up;
(d) the provisions of paragraph (c) of this proviso shall
take effect subject to the proviso to section 5. 4.

shed pursuant thereto
shall be wound up;
(d) the provisions of paragraph (c) of this proviso shall
take effect subject to the proviso to section 5. 4.

The sources of funds shall be-
(a) sums as may be provided for the Fund by Parliament,
either by way of grant or loan;
(b) allocation of public revenue raised by taxation or
otherwise as may be specified in relation to the Fund in
the fourth column of the Schedule;
(c) sums as may in any manner become payable to the
Fund as a result of operations of the Fund or sums
which may be released by the Treasury Registrar from
the allocation of public revenue specified in relation
to the Fund in the fourth column of the Schedule and
deposited in the Fund account required to be opened
for the purpose of the Fund under section 5(1). 5.–(1) The parastatal organisation charged with the
management of funds shall maintain the funds in a separately
designated bank account with the National Bank of Commerce
and manage the same in accordance with directions as the
Minister may issue:
Provided that, the parastatal organisation shall make no
payment out of the Fund except with the consent in writing of
the Treasury Registrar in accordance with the agreed annual
expenditure programme.

ke no
payment out of the Fund except with the consent in writing of
the Treasury Registrar in accordance with the agreed annual
expenditure programme.

(2) Where any payment out of the Fund is made for the
purchase of any equity investment, the equity investment shall
be held by-
(a) the parastatal organisation charged with the management
of the funds;
Sources of funds
Act No. 16 of 1983 s. 28
Management of
funds

ll
be held by-
(a) the parastatal organisation charged with the management
of the funds;
Sources of funds
Act No. 16 of 1983 s. 28
Management of
funds

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.429
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
(b) any other parastatal organisation; or
(c) the Treasury Registrar, as the Treasury Registrar may
direct, and any parastatal organisation holding any
equity investment shall, at any time, on the direction
of the Treasury Registrar, transfer the equity to any
other parastatal organization specified by the Treasury
Registrar or to the Treasury Registrar. (3) The Minister may, by regulations, regulate the
administration of the funds. (4) A person who makes or authorises any payment out
of the Fund in contravention of any provision of this Act or
any direction given or regulation made under this section
commits an offence and on conviction, shall be liable to a fine
not exceeding fifty thousand shillings or to imprisonment for
a term not exceeding five years or to both. 6.–(1) The parastatal organisation charged with the
management of funds shall cause to be prepared and kept
proper books of account of the payments made into and out
of the Fund.

sation charged with the
management of funds shall cause to be prepared and kept
proper books of account of the payments made into and out
of the Fund.

(2) The accounts in relation to the Fund shall be audited
annually by the office of the Controller and Auditor-General
and the audited accounts of Fund shall be published at the same
time as the audited accounts of the parastatal organisation
charged with the administration of the Fund are published. 7.–(1) Where the Minister is satisfied that, at the close of any
financial year, there are in any fund moneys which are not
immediately required for the purposes of the fund (which
moneys shall in this section be referred to as a “surplus”), he
may, where in his opinion financial exigencies or the public
interest require, and notwithstanding any provision to the
contrary contained in this Act or in any other written law,
authorise the application of the whole or any part of the surplus
for or towards defraying the development expenditure of any
Ministry or Department of the Government in any financial
year. Accounts and
audit
Power of Minister
to reallocate
moneys in funds
Act No. 9 of 1977 s. 20

stry or Department of the Government in any financial
year. Accounts and
audit
Power of Minister
to reallocate
moneys in funds
Act No. 9 of 1977 s. 20

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.430
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
(2) An authorisation for the application of any surplus made
under this section shall be sufficient authority, without further
appropriation, to issue from the fund, the sum required for the
purpose specified by the Minister.
(3) Where the Minister authorises the application of any
surplus under this section, he shall cause to be laid before the
National Assembly a statement concerning the authorisation.
[s. 6A]
8. The provision of this Act shall apply and take effect
notwithstanding the provisions of the Exchequer and Audit
Act and any other written law and any allocation of any
public revenue to any fund provided for in the fourth column
of the Schedule to this Act shall be made without further
appropriation.
[s. 7]
Act to apply
notwithstanding
any other written
law

n the fourth column
of the Schedule to this Act shall be made without further
appropriation.
[s. 7]
Act to apply
notwithstanding
any other written
law

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.431
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
SCHEDULE
(Made under section 3)
COLUMN 1 COLUMN 2 COLUMN 3 COLUMN 4
Production
Development
Fund
Purposes for which
Fund established
Parastatal
organisation
responsible for
management
Financial Resources
1. Sugar and
Sugar Products
Fund
(a) financing by way
of loan or equity,
of fixed investment
by parastatal
organisations
engaged in the
production of sugar
products;
The Sugar
Development
Corporation
established
by the Sugar
Development
Corporation
(Establishment)
Order. (a) Sales tax levied
on sugar to the
extent of 30 cts per
kilo;
(b) the balance
of the Sugar
Development Fund
held by the Sugar
Board, which
balance shall be
transferred to the
Sugar Development
Corporation for
the payment into
the Sugar Products
Fund. GNs. Nos.

ld by the Sugar
Board, which
balance shall be
transferred to the
Sugar Development
Corporation for
the payment into
the Sugar Products
Fund. GNs. Nos.

44 of 1974;
40 of 1975;
53 of 1975;
148 of 1975;
27 of 1976;
5 of 1983;
213 of 1991
(b) financing by way
of loan or grant,
Sugar research by
or for the benefit
of organisation
engaged in the
production of sugar
or sugar Products;
(c) financing, by
way of loan or
grant, training
of citizens of the
United Republic by
or for the benefit
of organisations
engaged in the
production of sugar
or sugar products.

oan or
grant, training
of citizens of the
United Republic by
or for the benefit
of organisations
engaged in the
production of sugar
or sugar products.

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.432
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
COLUMN 1 COLUMN 2 COLUMN 3 COLUMN 4
2. Sisal Products
Fund
(a) financing by way
of loan or equity, of
fixed investments
by parastatal
organisations
engaged in the
production of sisal
products;
(b) financing by
way of loan or
grant, research by
or for the benefit
of organisations
engaged in the
production of sisal
products;
(c) financing by
way of loan or
grant, training
of citizens of the
United Republic by
or for the benefit
of organisations
engaged in the
production of sisal
products. Tanzania Sisal
Authority
established by
the Sisal Industry
Act
One-half of the
Export Tax levied
on sisal:
Provided that the
amount paid into
the Sisal Products
Fund shall not
exceed Shs. 40,000,000/= in
financial year. 3.

of the
Export Tax levied
on sisal:
Provided that the
amount paid into
the Sisal Products
Fund shall not
exceed Shs. 40,000,000/= in
financial year. 3.

Textile and
Garments Fund
(a) financing by way
of loan or equity of
fixed investment
parastatal
organisations
engaged in the
production of
textiles, textile
products and
garments;
The National
Textile
Corporation
established by
the National
Textile
Corporations
(Establishment)
Order
(a) One half of the
export tax levied on
cotton;
(b) One tenth
of the sale tax
levied on locally
manufactured
articles falling
within tariff
numbers
51/53/55/56/57/58
and 60-01
GN. No. 268 of 1973
(b) financing by
way of loan or
grant, research by
or for the benefit
of organisations
engaged in the
production of
textiles, textile
products and
garments;

nancing by
way of loan or
grant, research by
or for the benefit
of organisations
engaged in the
production of
textiles, textile
products and
garments;

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.433
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
COLUMN 1 COLUMN 2 COLUMN 3 COLUMN 4
(c) financing by
way of loan or grant
training of citizens
of United Republic
by or for the benefit
of organisations
engaged in the
production of
textiles, textile
products and
garments. 4. Beverages
Fund
(a) financing by way
of loan or equity of
fixed investments
by parastatal
organizations
engaged in the
production of
beverages including
soft and alcoholic
beverages;
Tanzania
Beverages
Limited
established under
the Companies
Act of the Laws
of Tanzania
(a) sales tax levied
on beer to the
extent of 20 cts per
litre;
(b) sales tax levied
on soft drinks to the
extent of 20 cts per
litre;
(c) sales tax levied
on Konyagi to the
extent of Shs.5/=per
litre
GN. No. 5 of 1983
Cap.

tax levied
on soft drinks to the
extent of 20 cts per
litre;
(c) sales tax levied
on Konyagi to the
extent of Shs.5/=per
litre
GN. No. 5 of 1983
Cap.

212
(b) financing by
way of loan or
grant, research by
or for the benefit
of organisation
engaged in the
production of
beverages including
soft and alcoholic
beverages;
(c) financing by
way of loan or
grant, training
of citizens of the
United Republic by
or for the benefit
of organisation
engaged in the
production of
beverages including
soft alcoholic
beverages.

ng
of citizens of the
United Republic by
or for the benefit
of organisation
engaged in the
production of
beverages including
soft alcoholic
beverages.

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.434
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
COLUMN 1 COLUMN 2 COLUMN 3 COLUMN 4
5. Cashew
Industry Fund
(a) financing by way
of loan or equity of
fixed investments
by parastatal
organization
engaged in the
production,
processing and
marketing of cashew
nut;
The Cashew
nut Authority
of Tanzania
established by
the Cashewnut
Board of
Tanzania Act
One-half of the
export tax on
cashew nuts
(b) financing by
way of loan or
grant, research by
or for the benefit
of organisations
engaged in the
production,
processing and
marketing of cashew
nut;
(c) financing by way
of loan or grant,
training of citizens
of United Republic
by or for the benefit
of organisations
engaged in the
production,
processing and
marketing of cashew
nut. 6.

,
training of citizens
of United Republic
by or for the benefit
of organisations
engaged in the
production,
processing and
marketing of cashew
nut. 6.

Leather and
Leather Products
Fund
(a) financing by way
of loan or equity of
fixed investments
by parastatal
organisations
engaged in the
production of
leather or leather
products;
The National
Development
Corporation
The whole of the
production tax on
hides, skins and
leather levied under
the Hides, Skin and
Leather Trade Act
Cap. 120
(b) financing by
way of loan or
grant, research by
or for the benefit
of organisations
engaged in the
production of
leather or leather
products;

. 120
(b) financing by
way of loan or
grant, research by
or for the benefit
of organisations
engaged in the
production of
leather or leather
products;

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.435
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
COLUMN 1 COLUMN 2 COLUMN 3 COLUMN 4
(c) financing by
way of loan or
grant, training
of citizens of the
United Republic by
or for the benefit
of organisations
engaged in the
production of
leather or leather
products. 7. Tourism Fund financing by way of
loan or equity, of
fixed investments
by parastatal
organisations
engaged in the
promotion of
tourism in the
United Republic
The Tanzania
Tourist
Corporation
established by
the Tanzania
Tourist
Corporation
(Establishment)
Order
The whole of the
hotel levy collected
under Tourism Act
GN. No. 91 of 1969
Cap. 65
8. Commercial
Accountants and
Auditors Training
Fund
Financing, by
way of loan or
equity, training
of citizens of the
United Republic
as accountants and
auditors having
regard to the
requirements of the
parastatal sector. The National
Board of
Accountants
and Auditors
established by
the Accountants
and Auditors
(Registration)
Act. One-fifth of the
business licence fees
collected under the
Business Activities
Registration Act. Cap. 286
Cap.

ntants
and Auditors
(Registration)
Act. One-fifth of the
business licence fees
collected under the
Business Activities
Registration Act. Cap. 286
Cap.

208
9. Transport
and Vehicle
Operation and
Maintenance
Training Fund
financing by way
of loan or grant,
training of citizens
of the United
Republic as-
The National
Transport
Corporation
One-half of the
transport licensing
fees levied under
the Transport
Licensing Act. GN. No. 27 of 1976
Cap. 317
(a) motor-vehicle
operators;
(b) motor-vehicle
maintenance and
repair personnel;
(c) store-keepers,
stock clerks and
purchasing officers
in the motor vehicle
industry.

operators;
(b) motor-vehicle
maintenance and
repair personnel;
(c) store-keepers,
stock clerks and
purchasing officers
in the motor vehicle
industry.

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.436
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
COLUMN 1 COLUMN 2 COLUMN 3 COLUMN 4
10. Rural
productivity
Fund
Cap. 83
financing by way
of loan or grant,
of training of
citizens of the
United Republic
in bookkeeping
accounting, financial
management,
husbandry, farm
management,
construction, public
health and other
skills relevant to
the raising of rural
productivity with
special reference to
the needs of Ujamaa
village. The Governing
Body of the
Cooperative
College
established by
the Co-operative
College Act. (a) One-twentieth
of the export tax
levied on coffee;
(b) One-half of the
tobacco tax levied
under the Tobacco
(Imposition of Tax)
Act. Acts Nos. 25 of 1980
s. 14
11. Transfer Tax
Investment and
Management
Fund
Financing, by way of
loan or equity, small
scale industrial
investments
to increase the
country’s productive
capacity and self
sufficiency.

ement
Fund
Financing, by way of
loan or equity, small
scale industrial
investments
to increase the
country’s productive
capacity and self
sufficiency.

The Tanzania
Investment Bank
established by
the Tanzania
Investment Bank
Act
The whole of
transfer tax
collected by the
East African
Customs and Excise
Department under
the Transfer Tax
Act. Cap. 81
Act No. 44 of 1967
12. Coffee
Industry Fund
(a) financing by way
of loan or equity, of
fixed investments
by parastatal
organisations
engaged in the
production
processing or
marketing of coffee
and coffee products
The Coffee
Authority of
Tanzania
One-tenth of the
export tax levied on
coffee. Act No. 25 of 1980
s. 14
(b) financing, by
way of loan or
grant, research by
or for the benefit
of organisations
engaged in the
production,
processing or
marketing of coffee
and coffee products;

ay of loan or
grant, research by
or for the benefit
of organisations
engaged in the
production,
processing or
marketing of coffee
and coffee products;

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.437
THE PRODUCTION DEVELOPMENT FUNDS ACT [CAP. 125 R.E. 2023]
COLUMN 1 COLUMN 2 COLUMN 3 COLUMN 4
(c) financing by
way of loan or
grant, training
of citizens of the
United Republic by
or for the benefit
of organisations
engaged in the
production,
processing or
marketing of
coffee or coffee
productions.
13. Housing Fund financing by way
of loan or equity,
to organisations
or individuals for
the construction of
residential houses.
The Treasury Four percent of
payroll levy.
GN. No.
213 of 1991
14. Roads Fund financing by way of
loan or equity, for
the construction,
maintenance and
repair of roads.
The Treasury Five shillings and
fifty cents per litre
of petrol or diesel
payable under the
Road and Fuel Tolls
Act.
Cap. 220

©2025 Government of Tanzania. All rights reserved. No part of this book may be reproduced or distributed without permission of OAG.