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By Mary Karugaba
New Vision - UG
Nov 15, 2009
EAST African Community (EAC) finance ministers have agreed to adopt a fixed withholding tax rate on dividends, interest and royalties throughout East Africa.
This is ahead of the Council of Ministers meeting to discuss the draft on the common market protocol.
The ministers meeting in Arusha, Tanzania last week adopted fixed rates for withholding tax at 5% on dividends, and 10% on interest, royalties, management and professional fees under the draft agreement on avoidance of double taxation.
According to a press statement by the EAC secretariat, the ministers agreed that partner states should not negotiate with third parties rates lower than those in the EAC Double Taxations Act.
They also approved the remission of duty on goods used in the manufacture of exports subject to conditions of the protocol establishing the EAC Customs Union.
The ministers also agreed that the rates of the existing Double Taxations (DTAs) that partner states have with other countries be maintained until they expire. Any renewal of existing DTAs with third parties should be in accordance with the new positions agreed, the statement reads.
The post-budget consultative meeting was attended by finance ministers James Musoni, (Rwanda), deputy and Minister of finance Uhuru Kenyatta (Kenya), Syda Bbumba (Uganda), Jeremiah Sumari, deputy Minister of Finance and Economic Affairs (Tanzania).
Others who attended the meeting included the central bank governors and the respective permanent secretaries and senior officials from all the partner states.
The ministers said there was need to fast-track the establishment of the EAC Development Fund through the East African Development Bank
The fund will cater for infrastructure development, among other projects.
The Secretary General of the East African Community, Juma Mwapachu, hailed the meeting as historic after tackling infrastructural deficits that hamper national and regional economies.
The ministers also granted the request by Kenya for extension of remission of duty on malt to apply an import duty rate of 0% instead of 10% and for barley to apply an import duty rate of 10% instead of 25% until June 30, 2010.
The ministers for finance approved the exemption of spare parts for machinery used in mining imported by licensed mining companies.
They also granted remission of import duty on treads for cold retreading of HS Code to apply 0% instead of 10%.
The Council of Ministers is due to meet in Arusha to consider the Final Draft Common Market Protocol due to be signed by the EAC heads of state on November 20.
New Vision - UG
Nov 15, 2009
EAST African Community (EAC) finance ministers have agreed to adopt a fixed withholding tax rate on dividends, interest and royalties throughout East Africa.
This is ahead of the Council of Ministers meeting to discuss the draft on the common market protocol.
The ministers meeting in Arusha, Tanzania last week adopted fixed rates for withholding tax at 5% on dividends, and 10% on interest, royalties, management and professional fees under the draft agreement on avoidance of double taxation.
According to a press statement by the EAC secretariat, the ministers agreed that partner states should not negotiate with third parties rates lower than those in the EAC Double Taxations Act.
They also approved the remission of duty on goods used in the manufacture of exports subject to conditions of the protocol establishing the EAC Customs Union.
The ministers also agreed that the rates of the existing Double Taxations (DTAs) that partner states have with other countries be maintained until they expire. Any renewal of existing DTAs with third parties should be in accordance with the new positions agreed, the statement reads.
The post-budget consultative meeting was attended by finance ministers James Musoni, (Rwanda), deputy and Minister of finance Uhuru Kenyatta (Kenya), Syda Bbumba (Uganda), Jeremiah Sumari, deputy Minister of Finance and Economic Affairs (Tanzania).
Others who attended the meeting included the central bank governors and the respective permanent secretaries and senior officials from all the partner states.
The ministers said there was need to fast-track the establishment of the EAC Development Fund through the East African Development Bank
The fund will cater for infrastructure development, among other projects.
The Secretary General of the East African Community, Juma Mwapachu, hailed the meeting as historic after tackling infrastructural deficits that hamper national and regional economies.
The ministers also granted the request by Kenya for extension of remission of duty on malt to apply an import duty rate of 0% instead of 10% and for barley to apply an import duty rate of 10% instead of 25% until June 30, 2010.
The ministers for finance approved the exemption of spare parts for machinery used in mining imported by licensed mining companies.
They also granted remission of import duty on treads for cold retreading of HS Code to apply 0% instead of 10%.
The Council of Ministers is due to meet in Arusha to consider the Final Draft Common Market Protocol due to be signed by the EAC heads of state on November 20.
