PUBLISHED ON October 15th, 2014

Shippers oppose levy on transit goods introduced by Mombasa

Transporters are fretting over the introduction of a $2 per tonne tax on goods passing through the port by Mombasa County.

At a media briefing Tuesday, Shippers Council of Eastern Africa chief executive Gilbert Lang’at said the new levy will push up the cost of goods passing through the port.

The average annual cargo that goes through Mombasa is 18 million tonnes. This means that the county stands to collect up to Sh3.2 billion every year from the levy.

Mombasa has also imposed a health charge on trucks on the basis of environmental impact. “This is making the port un-competitive and then again, this is double taxing. We have been paying these levies to the bodies that handle them. They should sit with the national government and agree on a sharing deal that will not push up the cost of doing business,” Mr Lang’at said.

He said exports are likely to be the hardest-hit by these levies. “We do not want a ripple effect where other counties also impose levies on cargo passing through their areas,” Mr Lang’at said.

The council raised concern over new laws being enacted by regional governments for goods leaving the port heading upcountry, known as the northern corridor, saying they are hindering free movement of trade.

It said some areas have imposed levies that are increasing the cost of doing business in the country. “The most prominent of these are levies and the parking fees charged for trucks,” Mr Lang’at said.

The northern corridor passes through seven counties — Mombasa, Makueni, Machakos, Nairobi, Nakuru, Uasin Gishu and Bungoma.

County governments are supposed to raise revenue from internal activities.

“The port of Mombasa is a national asset. This is very clearly stated and, therefore, control in activities the levies and the income generated is within the national government,” Mr Lang’at said.

The council in May released a report citing potential non-tariff barriers emerging from county laws on transport.

Source:: Daily Nation

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