The East African Community (EAC), a regional intergovernmental organization, plans to conclude a comprehensive review of the uniform tariff rate, the Common External Tariff (CET) in 2021, an official said Wednesday.
Peter Mathuki, secretary general of the EAC, told a virtual forum that the six member states — Burundi, Kenya, Rwanda, South Sudan, Tanzania and Uganda — have agreed to increase the number of tariff bands to four from the current three in order to boost the region’s industrialization agenda.
“The review ought to have been done by June but now we look forward to having a new common external tariff by the end of the year,” Mathuki said during the forum on the EAC secretary-general’s 100 days in office.
The CET is currently structured under three bands — zero percent for raw materials and capital goods, 10 percent for intermediate goods and 25 percent for finished goods.
Mathuki said that the proposed fourth band will cater for imports of goods into the region that will attract duties above 25 percent, adding that out of the proposed 1,448 new product tariff lines for goods above the 25 percent band, partner states have already agreed on 457 tariff lines.
The partners have agreed to fast track the implementation of a new CET, because it will also help to resolve the issue of non-tariff barriers that currently hampers intra-EAC trade.
Kenneth Bagamuhunda, director general of customs and trade at the EAC, said that the CET review is also intended to shield domestic industries from unfair foreign competition and it will also include reforms for the duty remission and exemptions schemes for zero rated imports of raw materials that are used in the manufacturing sector.
“We want to ensure that goods are not imported as raw material but resold as finished products,” he added. Enditem