Rwanda ready to roll out single customs tax policy

Rwanda is ready to implement a single customs’ tax policy by the end of the month, even as some regional tax bodies plan to delay its implementation temporarily, Rwanda Revenue Authority has said.This was disclosed by Drocelle Mukashyaka, the Rwanda Revenue Authority (RRA) deputy commissioner for tax payer services. She was reacting to media reports that indicated that the rollout of the single customs tax policy could be delayed after Ugandan traders asked for more time to first understand its dynamics.She said the policy, meant to facilitate clearance of goods at the first point of entry and speed up assessment and collection of revenue, is on course for implementation despite concerns by some EAC partner states. “For us we are ready and on track for implementation of a single customs territory,” she told The New Times yesterday. Mukashyaka noted that the ongoing consultations will not affect the policy’s implementation. The Rwanda Clearing and Forwarders Association boss, Fred Seka, said if the implementation of the plan is delayed, it will hurt local businesses.“The single tax policy will ease the cost of doing business across the region; its implementation should be hastened because it is a step towards creation of a trade zone that is free from non-trade barriers,” he said.According to the single customs territory policy, taxes are assessed from first point of entry, and member states are expected to relocate customs officials to Mombasa port. It is also in line with eradicating barriers to trade by adopting a central model of clearance of goods, whereby taxes and assessment will be done only at the first point of entry and, thus, ensure faster clearing of goods as well as reduction in the cost of doing business.In June, Heads of State of the three countries, Rwanda, Kenya and Uganda decided to establish the territory, whereby Rwanda would spearhead its implementation, as well as the single tourist visa and use of identity cards as travel documents.It is envisaged that the cost of clearance, excluding transport of 20-feet containers, will reduce by 50 per cent from $383 to $193 once rolled out.Traders will, therefore, save about $45m annually from reduced clearance costs, basing on 2012 statistics which show that over 237,000, 20-feet containers destined for Rwanda and Uganda were cleared through Kenya.The deadline for the implementation of the single customs territory was first set for 2010, as an important ingredient to EAC integration process. However, due to lack of strong institutional and mutual commitment from all the five East African Community (EAC) member states, the deadline was not met. Rwanda, Uganda and Kenya continued to hold discussions on its implementation but without any specific deadlines- until recently- when Rwanda Revenue Authority (RRA) and Private Sector Federation announced that the regional single customs territory was scheduled to be ready by end of September.

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Rwanda ready to roll out single customs tax policy