To support Small and Medium Enterprises involved in trade across the borders of Uganda and Burundi, the Rwanda Revenue Authority (RRA) has exchanged a list of goods that can be considered to ease border posts clearance.
This comes as a relief to traders who in the past have been forced use a certificate of origin document to clear their goods, a document that is slightly costly and not readily provided at the border.
With the exchange, traders with goods worth any amount below $500 will clear their goods using a simplified certificate provided at the respective borders.
The initiative is also in the framework of the East African community (EAC) integration agenda that targets creating a conducive environment for doing business in the region
“This is a break through for us as traders will easily move goods across borders using a simplified document.
We will soon do the same with Tanzania,” Eugene Torero, the Deputy Commissioner General for Customs at RRA revealed to Business Times on Tuesday.
Torero observed that RRA is successfully implementing the EAC Customs Union protocol following the official commencement in July this year.
“The issues raised at the beginning of implementation have all been addressed. We have carried out extensive sensitization among the business community to facilitate the implementation process,” he said.
Torero also noted that his institution is still upbeat about the gains from the implementation of the regional economic bloc in the coming year.
The EAC Common External Tariff (CET) attracts a three band structure that attracts 25 percent on finished goods from outside the community, 10 percent on semi finished and 0 percent on raw materials.
Rwanda has projected a revenue loss of Rwf12.2 billion as it joins the Customs Union though the loss is being compensated by the COMESA compensation fund.
The Ministry of Finance has so far received Rwf 8.8 billion from COMESA to counterbalance projected revenue losses incurred.
The payment constitutes an advancement of 65 percent of the total estimated revenue loss to Rwanda which is Euros 15.9 million.
Statistics show that Rwanda’s customs revenue collection as the main revenue earner has significantly reduced from 52 percent in 2001 to 37.5 percent in 2008, largely due to implementation of regional trade agreements including the COMESA Free Trade Area.
The implementation of the Customs Union is expected to lead to a fully fledged phase in January 2010.