East African Finance Ministers Read 2024-2025 Budgets Concurrently

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As per the East Africa Community traditions the Finance Ministers from the member countries read their budgets on the first Thursday of the second week of June. Below is an excerpt from the East African.

East African finance ministers are presenting their spending plans for the 2024/2025 fiscal year against a backdrop of a fragile operating environment fuelled by rising public debts, high fuel prices, falling household and business incomes and global geopolitical tensions in the Middle East and Eastern Europe, which are colluding to stifle economic growth in the region.

Kenya, Uganda, Tanzania and Rwandan finance ministers will be outlining their budgetary allocations to key priority sectors to bolster economic growth and the various taxation measures to fund the budgets.

However, the ministers face a delicate balancing act in adopting revenue-raising policies that do not push the economies into debt distress and discourage regional trade and investment through punitive taxation measures.

The region’s growth is projected to pick up from an estimated 3.5 percent in 2023 to 5.1 percent in 2024 and 5.7 percent in 2025, according to the African Development Bank (AfDB), boosted by infrastructure development and increased regional trade.

Kenya’s finance minister Njuguna Ndung’u has proposed to remove excise duty on eggs. This is part of the President Yoweri Museveni-Ruto deal on importation of eggs from Uganda

“To promote trade across the EAC region, I propose the removal of excise duty on imported eggs, potatoes, and onions originating from EAC Partner States subject to goods meeting the EAC rules of origin,” he said.

Kenya has been allowed by EAC finance ministers to continue charging import duty on rice at 35 percent instead of the EAC rate of 75 percent for another one year. This duty remission started in the financial year 2021/22.

Also, wheat will be imported at 10 percent import duty instead of the EAC 35 percent.

Duty remission at the rate of 10 percent on the parts used in the assembly of motor cycles extended for one year across the region.

Iron and steel products to be taxed at 35 percent instead of the EAC’s common rate of 25 percent.

Animal feeds to continue being duty-free.

Imported leather bags to stay at 35 percent instead of the EAC 25 percent.

New custom measures

Kenya granted duty remission on import of assembly items for mobile phones, smartphones and laptops. Parts will now be duty free.

Import duty on prime movers to increase to 25 percent up from the EAC’s common rate of 10 percent, and 35 percent for trailers for one year.

Kenya to apply a higher duty of 35 percent on apparel and clothing industry imports, instead of the EAC common 25 percent.

Excise duty removed from eggs, poultry products and other items. This is part of the Museveni-Ruto deal on importation of eggs from Uganda. Hope is to see a decline in prices of poultry products.

—Source: The East African