Taxmen, police frustrate cross border business, traders complain *Majority say EAC is now of little benefit to them
- Published on 27 February 2017
When the East Africa Community (EAC) was revived on July 7, 2000, setting the regional integration milestones beginning with establishment of Customs Union, Common Market, Common Currency and lastly arrangements for a political federation, residents of the partner states, especially people engaging in cross boarder business, had high hopes of having their standard of living uplifted in one way or another.
However, in reality such a dream has vanished in the thin air as business environment in some borders has turned ‘hostile’ with tax or custom officials and police bearing the blame.
A survey conducted by the Guardian newspaper (with the financial support of the Foundation for Civil Society)) at Mutukula which borders Tanzania and Uganda and also at Kaisho, a centre located about 30 kilometres from another border location called Murongo, both in Kagera Region, has proved beyond reasonable doubt that individuals engaging in cross-border trade are subjected to stringent taxation measures and unnecessary harassment by officials on the Tanzania side.
The mistreatment, according to the business community, has prompted them to stop importing goods, especially non-food products from Uganda through Mutukula and Murongo borders.
Traders who volunteered to speak to The FCS correspondent revealed that cross border trade, especially which involves textile products, has substantially declined as majority of traders have now opted to buy their goods from Mwanza and Dar es Salaam Regions.
A petty trader who identified himself by the single name of Shafii, said that most textile traders had ceased to import their goods from Uganda, after some of their colleagues underwent stringent taxation procedures at Mutukula border in the previous days.
“I personally thought that EAC would simplify cross border business, but unfortunately, that is not the case,” he insisted. However, Shafii admitted that the regional bloc had significantly simplified the movements of its citizens.
A woman in Bukoba Municipality, who runs the baby cloth shop and who preferred anonymity, said she found it easier to buy her merchandise from either Dar es Salaam or Mwanza rather than Uganda due to taxation hassles.
This reporter witnessed the luggage of passengers who had either started their journey at Mutukula border and traveling to Bukoba or had crossed the border to Tanzania from Uganda, being thoroughly inspected by tax officials.
This reporter’s small bag was also searched by custom officials at Mutukula border as he was returning from Uganda side where he had briefly crossed, obviously in search for commodities they thought were purchased on the Uganda side of the border.
Donatus Martin, a trader at Kaisho centre in Kyerwa District near Murongo, at the border between Tanzania and Uganda, blamed Tanzanian tax officials for being too harsh on them as opposed to their colleagues in Uganda (Ugandan tax officials).
“Ugandan tax officials are so considerate to us whenever we buy goods there, but trouble now starts brewing when you meet the Tanzanian tax officials. Personally, I am no longer importing commodities from Uganda,” he said.
He added:” Once you meet Tanzanian tax officials at the border they would start counting one item after the other before they slap you with unbearable tax estimates.”
According to Martin, a businessman may find himself paying almost 80 per cent of the total value of the commodities he purchases in Kampala as tax at Murongo border.
He said it might take him four days to travel to Mwanza and bring back merchandise to his shops at Kaisho, but business would still be more profitable than importing it from Uganda through Mutukula or Murongo borders, a trip that takes only a single day.
Majaliwa Emmanuel a young businessman at Kaisho centre, branded Murongo border as an ‘unfriendly gate’ for their business. He went further to describe the EAC as a ‘failed project’ simply because it does not benefit ordinary people engaging in petty business.
“When we speak of EAC as a project, our leaders should come up with a way to see how we, the petty traders, would benefit from the bloc. It does not sound good for tax officials and police at the barriers to harass us whenever we cross the border while carrying commodities bought from Uganda,” he insisted.
He added :”We hear everydaythat EAC has institutions like Customs Union and Common Market but for us, the common people, we don’t see their benefits because the taxes are high whenever we import goods from neighboring Uganda”.
Majaliwa admitted that customs officials were only flexible if one bought items in Uganda for personal use at home such as flour or cooking oil but not for anything they suspected was meant for sale.
Edward Bibangama echoed similar sentiments, saying estimates for tax on goods imported from the neighbouring Uganda was high, a factor that discourages them from travelling to Kampala or Mbarara.
Bibangama said sometimes, police officers stationed at road barriers would ask them (the businessmen) to offload their commodities from vehicles for tax verification.
“Always we pay tax at the borders but police stationed at barriers would start harassing us as if customs officials have not done their job. This is embarrassing,” he said. Another petty trader, Deus Daudi expressed similar sentiments.
Aristide Fulgence expressed his disappointment with customs officials. “One day I was forced to surrender my commodities worth TSh. 50,000 to customs officials for no apparent reason. For a petty trader like me, that was a huge blow,” he said.