Kenya's textile sector to be hit by EAC sectoral council tax proposal

The council wants the duty levied on textiles under the common external tariff (CET) to be changed to 35 per cent–the highest band under the EAC.

The proposals were made at the council during its 38th extra-ordinary meeting held in Kilimanjaro, Tanzania.

The move is aimed at promoting production of cotton in the region and cutting overreliance on imports, which has hindered development of the sector, the council said.

Kenya produces less than 12 million square metres of woven fabric per year, against a market demand of approximately 171 million square metres, making the country a net importer of both cotton and textile.

Currently, finished goods imported into the regional bloc attract a duty of 25 per cent, intermediate goods 10 per cent and raw materials nil duty under the EAC’s existing three-band tariff structure, which came into effect on January 1, 2005.

The council also wants expansion of the harmonised cotton, textiles and apparels articles under duty remission to enhance trade among EAC member states, media outlets in the region reported.

It wants the member states to establish a digital platform to support exchange information on the harvesting of cotton and trade of cotton lint to raise intra-EAC trade.

As part of promotion of the ‘Buy East Africa Build East Africa (BEABEA)’ initiative, the meeting encouraged partner states to adopt the use of traditional wear as government attire at official events.

The meeting proposed developing a leather industrial park with common effluent treatment in the region to boost the region’s lagging leather industry.

Fibre2Fashion News Desk (DS)