Ugandan importers to boycott Mombasa

October 2, 2012 — Leave a comment

Ugandan importers say they intend avoiding using the Port of Mombasa in Kenya in favour of Tanzania’ Dar es Salaam in future, because of unresolved issues with the Kenyan taxman.

Some 600 containers destined for Uganda are being held at the Kenyan port following the introduction of a cash bond tax. The chairman of the Kampala Traders Association announced last week that the association had resolved to suspend using Mombasa in the interim, reports New Vision (Kampala).

In addition, importers say they will take legal action against the Kenya Revenue Authority (KRA) which has issued a directive instructing importers to lodge either a cash bond equivalent to the value of the imported goods or a bank guarantee to the same value. This must be deposited before the goods being imported can be cleared.

The directive has affected not only the 600 containers waiting at the port but imports of motor vehicles and sugar.

Uganda’s trade minister, Amelia Kyambadde said she had been informed by the Uganda business community that the KRA, under notice CUS/L&A/LEG/1 had made a unilateral decision on a requirement for a cash bond or bank guarantee on transit sugar and motor vehicles above 2000cc.

Ugandan authorities say the action by the KRA directive constitutes another non-tariff barrier imposed by Kenyan authorities on its transit cargo and contravenes East African Community Customs Union protocol and decisions reached by the Council of Ministers in March 2012 on removal of non-trade barriers in the community.

“If Kenya needs an instrument to regulate regional trade in sugar and other products, a cash bond is not the instrument to apply,” said Kyambadde. Sources: Ports.co.za / New Vision (Uganda).

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