TANZANIA – Tanzania has imposed a 25% import duty on Kenyan firms in confectionery business citing use of imported zero-rated industrial sugar in the goods.
TheEastAfrican has reported that Tanzania has refused to allow duty-free entry of Kenyan-made confectionery, juice, ice cream and chewing gum products into the country despite talks.
The levy was imposed after Tanzania refused to accept certificates of origin issued by the Kenya Revenue Authority, document that guaranteed the entry of Kenyan goods tax-free passage to Uganda and Tanzania.
As a result, Kenya has warned it will block the entry of Tanzania goods into the country giving Tanzania authorities an End-May ultimatum to visit the Kenyan firms to find out if imported industrial sugar is being used in the products.
“Tanzania Verification Mission to visit Kenya on use of duty free sugar imports on confectioneries to be completed in two weeks (May 31, 2018).
“Failure to adhere will result in implementation of retaliatory measures,” said the report of a presidential roundtable.
“All manufacturers (have been) requested to comply and co-operate with the Tanzania Verification Mission.”
According to the East Africa Community, the common market made of Tanzania, Kenya, Uganda, Rwanda and Burundi allows free movement of locally manufactured goods within the bloc.
However, Tanzania and Uganda revenue bodies have accused Kenyan manufacturers spearheading unfavorable competition by using industrial sugar imported under a 10% duty remission scheme.
Despite KRA’s intervention by providing evidence, the countries especially Tanzania maintained a hard stance in rejecting evidence from the certificates it issued.
In defense of its actions, Tanzania cited EAC Legal Notice number EAC/70/2017- where Kenya was granted duty remission on raw sugar, at a duty rate of zero percent for one year to manufacture sugar for industrial use.
“The denial of entry for Kenyan goods into Tanzania continues despite KRA’s intervention to clarify the matter to its Tanzanian counterpart,” the manufacturers’ lobby said on April 26.