Investors push county governments to scrap invasive taxes

By Yvonne Kawira

There has been increased push by investors and development players for county governments to scrap invasive taxes that impede doing business in the bloc.

 

The organisations have stated that the taxes imposed on traders as they transport goods to other regional markets, are hurting trade making their products uncompetitive.

 

TradeMark East Africa (TMEA) CEO Mr Frank Matsaert

Speaking at the annual stakeholder forum last week, TradeMark East Africa (TMEA) CEO Mr Frank Matsaert said that although there has been significant improvement in time reduction for transit goods there are still barriers slowing down trade.

“There has been significant improvement by ports in the region in terms of efficiency and time reduction,” Mr Matsaert noted. He however raised concern over the general business environment affecting trade in the bloc.

“The county taxes are likely to erode gains on reduced transportation costs and thus erode competitiveness,” he remarked.

Last month, Shippers Council of Eastern Africa (SCEA) regional Shippers council has raised alarm over transport laws, imposed by county governments along the northern corridor, saying they are barriers to movement of goods along the transport corridor. 

The Kenya Maritime Authority also aired similar concerns saying the taxes raise the cost of doing business and could discourage traders in the region from using Kenya’s seaport.

TMEA has been working with the East Africa Community (EAC) secretariat and the five member states’ national governments to come up with ways to boost ease of doing business in the bloc with an overall target to reduce transit cost by over 15 per cent by 2016. 

“I am very glad to report, early indications suggest that we are very near to achieve that two years early, with our partners, and we may be looking to increase our targets to 25 per cent time reduction,” Mr Matsaert announced.