The cost of importing goods into the East African Community through the Single Customs Territory (SCT) will go down under a new, reduced import insurance rate.
Under the amended EAC Customs Management Act 2010, all partner states will charge a cost insurance freight rate of one per cent on all imported goods under SCT, down from the initial 1.5 per cent and above.
“For purposes of computing the Customs value, where no insurance is ascertainable, the price paid is to be increased by the national charge for insurance, which should be taken as 1 per cent of CIF for imported goods,” said the EAC ministers.
The EAC partner states charge different import declaration fees. In Kenya, it is 2.25 per cent of the CIF value; in Rwanda it is 5 per cent and Uganda 6 per cent.
The East African Legislative Assembly recently adopted an amendment to the EAC Customs Management Act that will enable persons intending to import goods to write to the commissioner for advance rulings on either tariff classification, rules of origin or Customs valuation.
In the past, EAC importers and revenue authorities have disagreed on the tariff code under which an item should be classified and the Customs value that an item should be accorded.
Import insurance rate
“The Customs valuation should be based on the actual price of the goods being imported, which is indicated on the invoice, especially on goods like cars,” said Kenya Shippers Council chief executive Gilbert Langat.
Mr Langat said that the newly harmonised import insurance rate will discourage dumping. Under SCTt, the EAC member states will adopt a destination model of goods clearance, where assessment and collection of revenue will be done at the first point of entry.
According to a report by the EAC Secretariat released early this month, only Tanzani and Kenya have fully rolled out the SCT maritime imports and transfer procedures. Rwanda has rolled out all SCT procedures on all goods except exports while Uganda has rolled out the SCT maritime and transfers procedures on a select number of goods.
Rwanda is the only country using the Regional Customs Transit Guarantee system (RCTG) as a regional bond. Other partner states are still using national bonds for movement of warehousing or transit goods within and through the Community.
Source: The East African

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