Tanzania maintains it will not allow duty-free access of Kenyan confectionery products and manufacturers must pay a 25 per cent levy.

The country’s Commissioner for Customs and Excise Ben Usaje said Kenyan manufacturers enjoy the use of zero-rated industrial sugar in the production of juice, ice cream, chewing gum, sweets and other confectionary products.

He said a team set up by East Africa Community to look into the matter did not arrive at a conclusive position leaving Tanzania no option but to maintain the tax.

“We will continue slapping the products with 25 per cent duty until maybe when another study is done,” said Usaje.

He said the team failed to answer the question on whether the Kenyan exports were being manufactured through the use of zero-rated industrial sugar.

Usaje said the EAC team also failed to take a clear position on whether the products qualify for free entry into Tanzania market.

“The team of experts left us in dilemma on what they had gone to test,” said Usaje.

He was speaking on Tuesday at Tanzania Revenue Authority headquarters in Dar es Salaam.

The EAC team reported that products manufactured using industrial sugar when transferred to the EAC qualify for preferential tariff treatment provided they meet the criteria set under the Rules of Origin and any other set conditions.

The team said Kenya should provide a position to the EAC partner states on the quality of sugar imported into Kenya.

It also recommended the Kenya Sugar Directorate put tighter controls on the trade of sugar for industrial use in the local market.

This is after the team established that sugar for industrial use was not imported under the provisions of the Kenya Gazette Notice No 4536 of May 11, 2017.

The notice sought the importation of duty free sugar and powdered milk to mitigate the then escalating prices of sugar and guarantee availability to the public. The gazette notice was to remain in force till August 31, 2017.

Tanzania’s position is that the team failed to categorically state whether or not imported industrial sugar was being used in the products at the centre of the trade dispute which has gone unresolved since March.

Kenya has threatened to block the importation of Tanzanian goods over the country’s refusal to allow the duty-free entry of the products.

Tanzania rejected certificates of origin issued by the Kenya Revenue Authority (KRA) and opted to levy 25 per cent import duty on the products.

Acceptance of the certificate, which shows a product’s point of origin, is used to determine duty for imported goods. It guarantees the entry of Kenyan goods tax-free passage to Uganda and Tanzania.

Source The Star

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