EAC signs tax harmonization agreement with Germany

The East African Community (EAC) and the Government of the Federal Republic of Germany on Tuesday signed a technical cooperation agreement to promote tax harmonization within the Community.

The East African Community (EAC) and the Government of the Federal Republic of Germany on Tuesday signed a technical cooperation agreement to promote tax harmonization within the Community.

The agreement was signed at the EAC headquarters in Arusha, Tanzania, by the EAC Secretary General, Ambassador Juma Volter Mwapachu and the German Ambassador to Tanzania, Wolfgang Ringe.

Mwapachu said that the agreement was timely and praised Germany for supporting the EAC integration process. The €2 million deal is to be implemented within a period of 8 years ending 31 December 2015.

“This particular agreement is very timely as it comes at a time when the EAC Partner States have embarked on the negotiations for the EAC Common Market Protocol. A major pillar of a Common Market Protocol is a harmonized tax laws and regimes of the Partner States, which the project is looking at,” he said.

Ringe pledged his country’s readiness to partner with the EAC in building a strong regional community by supporting tax harmonization between all partner states.

He said Germany as a member of the European Union (EU) has a lot of experience in integration issues that the EAC could benefit from.

Germany also offered support to the EAC in peacekeeping and small arms control. It also agreed to provide additional €6 million on top of the 8 million already offered for the construction of a new EAC headquarters.

The need for additional funding was caused by the admission of Rwanda and Burundi into the community in July 2007, which enlarged the bloc from three to five nations with a combined population of 120 million people.

New space is also needed to accommodate the offices of the East African Legislative Assembly (EALA) and the East African Court of Justice.

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