This paper is about a country's tax structure to Foreign Direct Investment (FDI) inflows using Tanzania as a case study. In essence it is argued that the tax structure and the type of incentives offered by a country can be a major determinant of FDI inflows for third world countries. The paper is divided into six sections. In the introduction, a general overview of incentives is discussed. The general objectives of tax incentives are discussed in part two while their classification is made in part three. Parr four deals with the general overview of tax structure in Tanzania. Incentives offered by the country are discussed in part five whereas the paper concludes by pointing out some investment risks that may hinder the inflows of FDI into the country and other factors that can be equally important in attracting FDI inflows.