Push for uniform East Africa drugs, food taxes in Covid-19 war


EAC head of states at a past meeting. FILE PHOTO | NMG

Industrialists are pushing for uniform tax cuts on medical supplies and essential goods across East Africa to cushion businesses as coronavirus ravages the region.

Through their lobby, the East African Business Council (EABC), the manufacturers said reduced taxes will boost production and supply of food as well as medical products amid increased demand.

EABC chief executive director Peter Mathuki said the tax breaks are part of a uniform recovery plan that the lobby proposed to the East Africa Community (EAC) states following restrictions that have pushed manufacturers to either shut down or operate below capacities.

Covid-19 has disrupted production among manufacturers in the region and major raw materials import countries like China, fuelling fears of stock-outs in essential commodities.

The disease has so far claimed 12 lives in Kenya and Tanzania with over 400 infections in the region as at April 12.

“EAC partner states to adopt common fiscal incentives and response measures for the business sectors negatively impacted by the Covid-19 … waive customs duties, Value Added Tax and agree on the equivalence of standards for medical devices and protective equipment from the region and other highly demanded goods,” Mr Mathuki proposed on Sunday.

The push for tax breaks on preventive kits for health workers come on the back of a global shortage that has hit EAC countries.

Manufacturers, small and medium enterprises (SMEs) are currently feeling the heat from restrictions imposed by various countries including partial and complete freeze on movements and a ban on all public gatherings that have in turn forced them to temporarily close or operate below capacities.

Mr Mathuki added that EAC states should allow free movement of East Africans across the member states — a push likely to spark resistance from countries that have so far closed their borders.

Uganda and Rwanda last month sealed off their borders in a bid to curb spread of coronavirus from neighbouring countries and are only allowing goods.