Kenya has the opportunity to withdraw duty on items imposed by the East African Community following the withdrawal of the Finance Bill 2024. Experts believe the country could seek a stay of application to align with EAC Treaty provisions, allowing for a review of the controversial tariffs. The recently implemented common external tariff by the EAC Council of Ministers has raised concerns among businesses in Kenya, who fear its impact on industry competitiveness and revenue. President Ruto has acknowledged the need for budget reorganization to accommodate the new tax regime, emphasizing austerity measures.
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The EAC CET aims to promote regional integration and protect local manufacturers from external competition. Import duties on certain products have been adjusted, potentially affecting prices and trade within the region. While Kenya considers its options under the EAC regulations, stakeholders are working to gather data and address concerns related to the new tariffs. The impact of these changes on various industries remains to be seen, as countries adopt different duty rates for specific goods to support domestic production.