The Effectiveness of the Use of Alternative Dispute Resolution in Resolving Tax Disputes in Tanzania: A Comparative Study with Kenya

This article examines the effectiveness of alternative dispute resolution (ADR) in resolving tax disputes in Tanzania, with comparative reference to Kenya. It argues that Tanzania’s tax laws recognize ADR but do not give it the procedural and institutional clarity that predictable, fair and enforceable outcomes require, and that Kenya’s experience shows how that gap may be narrowed. The article employs doctrinal and comparative approaches. It finds that Tanzania has a legal and institutional basis for ADR in tax disputes, but the framework remains fragmented and lacks a comprehensive tax-specific procedure. Key challenges include uncertainty concerning ADR and statutory objection and appeal timelines, inadequate safeguards for independence and confidentiality, uncertainty regarding the legal effect and enforcement of settlements, limited taxpayer awareness, unequal bargaining power and weak institutional coordination. Compared with Tanzania, Kenya has a more structured tax ADR framework supported by specific legislation and subsidiary regulations. The article concludes that ADR has significant potential to improve tax dispute resolution in Tanzania. It recommends the development of a coherent tax-specific ADR framework, clearer settlement procedures, stronger safeguards for neutrality and confidentiality, improved institutional coordination and greater awareness among taxpayers and relevant practitioners.