Dismiss Notice
You are browsing this site as a guest. It takes 2 minutes to CREATE AN ACCOUNT and less than 1 minute to LOGIN

East Africa to have fixed withholding tax

Discussion in 'International Forum' started by Invisible, Nov 16, 2009.

  1. Invisible

    Invisible Admin Staff Member

    #1
    Nov 16, 2009
    Joined: Feb 11, 2006
    Messages: 9,095
    Likes Received: 140
    Trophy Points: 160
    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.
     
  2. Freetown

    Freetown JF-Expert Member

    #2
    Nov 16, 2009
    Joined: Apr 6, 2008
    Messages: 888
    Likes Received: 6
    Trophy Points: 35
    Je Tanzania itambulia nini hapo?? au ndo kusindikiza
     
  3. Ndahani

    Ndahani JF-Expert Member

    #3
    Nov 16, 2009
    Joined: Jun 3, 2008
    Messages: 11,570
    Likes Received: 152
    Trophy Points: 160
    Wachumi wanaweza kutusaidia kujua advantages and disadvantages za system hii tunayotaka ku adopt?
     
  4. Freetown

    Freetown JF-Expert Member

    #4
    Nov 16, 2009
    Joined: Apr 6, 2008
    Messages: 888
    Likes Received: 6
    Trophy Points: 35

    Tatizo nafikiri wachumi huwa hawashirikishwi, mambo mengi huwa yanafanywa kisiasa
     
  5. Invisible

    Invisible Admin Staff Member

    #5
    Nov 16, 2009
    Joined: Feb 11, 2006
    Messages: 9,095
    Likes Received: 140
    Trophy Points: 160
    Wachumi tunao pia humu JF, naamini mkuu MgonjwaUkimwi au Zitto wanaweza kutufahamisha nini athari za kinachoendelea (positive au negative effects).
     
  6. Next Level

    Next Level JF-Expert Member

    #6
    Nov 16, 2009
    Joined: Nov 17, 2008
    Messages: 3,160
    Likes Received: 13
    Trophy Points: 135
    Advantages za kuharmonise tax rates EA, nikuzifanya nchi wanachama kuwa kny platform moja kwenye market i.e inaavoid nchi moja kuwa less or more competitive kuliko nyingine! Kwa mfano (ceteris paribus) investors watakuwa indiferent kuwekeza in either member state kwani gharama za kodi ina kuwa si deciding factor......!

    Pili wakipitisha hiyo DTA btn EA member states, itawaondolea raia na wawekezaji wa EA matatizo ya double taxation....i.e yaani kama mimi ni mkenya nikawekeza bongo, basi kama mapato yangu yatapigwa kodi TZ nikireport mapato hayo Kenya hayapigwa kodi mara ya pili and the vice versa is true!

    Tatu, kuwa na harmonised tax rates kunaongeza wigo wa kuwekeza kwa wawekezaji, such that EA members watakuwa hawafikirii tu kuwekeza kny nchi zao tu watakuwa wanaconsider kuwekeza kny nchi za EA coz hakuna kizuizi cha kodi!

    Disadvantages, in case nchi mmoja ina fursa nyingi za uwekezaji kuliko nyingine kwa sababu labda ya uchumi wako bado ni mdogo, na nyingine haina fursa kuwekeza huko kwao, basi fursa zilizopo ni rahisi sana kuchukuliwa na wageni coz hakuna kizuizi cha kodi!

    Pili nchi inaweza kushindwa kumeet some objectives za kuweka kodi......tukumbuke mbali ya kuwa chanzo cha mapato, kodi pia hutumika kucontrol dumping, kuminimize gap between rich & poor, kucontrol inflation, kudiscourage imports etc.....!

    Nashangaa TZ tuna DTAs na SA, Zambia, Norway, Denmark, Canada,India etc lakini cha kushangaza hatuna DTAs na Kenya, Uganda, wala Rwanda wala Burundi......! Haya ni mambo ya ajabu kweli, sina uhakika kama tupo serious na mambo yetu!
     
  7. Lekanjobe Kubinika

    Lekanjobe Kubinika JF-Expert Member

    #7
    Nov 16, 2009
    Joined: Dec 6, 2006
    Messages: 3,067
    Likes Received: 14
    Trophy Points: 135
    Kama wakubwa hawaoni manufaa kwao ya moja kwa moja hawawezi kushabikia, hasa wakati kama huu ambapo kila mtu anatafuta chake mapema.

    Leka
     
  8. K

    Koba JF-Expert Member

    #8
    Nov 16, 2009
    Joined: Jul 3, 2007
    Messages: 6,064
    Likes Received: 435
    Trophy Points: 180
    ...aiseeh sio kila kitu ni ufisadi babangu,soma uelewe vizuri hii kitu ni nzuri sana na ninashangaa bado haijapitishwa!
     
Loading...