Head of the telecoms regulator was suspended Tuesday being alleged to have failed in monitoring the industry that led to the loss of potential tax revenues.
President John Magufuli has also dissolved the governing body of Communications Regulatory Authority of the country.
The potential tax revenues loss was about 400 billion shillings a year since 2013.
A statement from the president’s office said the government should collect all the outstanding tax revenues otherwise strict action would be taken on anyone obstacling the drive.
After taking to office late last year the president pledged to be rooting out corruption from the country and he would also not tolerate inefficiency.
Earlier this year Magufuli had sacked several senior officials including chief executive of port authority.
In 2013 the telecoms regulator signed a contract with a private firm for installation of a telecommunications traffic monitoring system. It was headed by Ally Simba and under him the regulator failed to use the monitoring system.
Tanzania has the second-largest economy in east Africa and communications is the fastest growing sector for the population of over 47 million.
In 2015 the mobile phone subscribers’ number rose by 25 percent.
A general tax crackdown has also been launched by Magufuli and the revenue authority too has been ordered to target large-scale tax evation.
Neighboring Ghana is more successful in developing innovative ways of collecting telecoms revenue. The country has recently introduced interconnect chearinghouse (ICH) too to help fight fraud though the new system was initially highly criticized.