Home / Knowledge / News / Textiles / East Africa agrees on tax waiver for textile inputs
East Africa agrees on tax waiver for textile inputs
Jun '17
The six-nation East African Community (EAC) comprising Burundi, Kenya, Rwanda, South Sudan, Tanzania and Uganda has agreed to a three-year tax waiver of duties and value added tax (VAT) on textile raw materials, fabrics and accessories that are not available locally. This step is expected to reduce the cost of production and also boost local manufacturing.

The three-year tax waiver was suggested in a report on the textiles and footwear sector, commissioned by the EAC.

As per the EAC directive, the EAC will now shift to a four-band tariff structure for cotton, textiles and apparels to promote cotton yarn and fabric production. While imported raw materials not available in the region would attract zero duty, intermediate inputs would be taxed at 10 per cent, fabrics at 25 per cent, and readymade garments at 40 per cent or $5 per kg.

The EAC partner countries have also agreed to adopt a three-year strategy (2017-19) for gradual phase out of used clothing and shoe imports. This will be done through increased tax on these products, compliance with EAC Standards licensing of importers, and categorisation of products per bale of imports, African media reports said.

The partner states have also decided to “establish Cotton Lint Banks modelled around Uganda cotton buffer stock model to ensure availability of cotton lint for spinning mills and downstream value addition.”

All partner states producing cotton lint will set a target of at least 30 per cent local value addition to domestic cotton lint. This threshold would be increased to 50 per cent within five years, according to the recommendations on the modalities for promotion of textile and leather industries in EAC. (RKS)

Fibre2Fashion News Desk – India

Must ReadView All

May 31 deadline for registration of chemicals under REACH

Textiles | On 23rd May 2018

May 31 deadline for registration of chemicals under REACH

May 31 is the final deadline for companies to register all chemicals...

IOC, MCPI to set up ₹1000 cr PSF unit in Odisha

Textiles | On 23rd May 2018

IOC, MCPI to set up ₹1000 cr PSF unit in Odisha

Indian Oil Corporation (IOC) has teamed up with Materials Chemicals...

Pakistan's textile exports up 8.13% in July-April FY18

Textiles | On 23rd May 2018

Pakistan's textile exports up 8.13% in July-April FY18

The value of textile and garment exports from Pakistan increased by...

Interviews View All

Top executives
Textile industry

It will take some time for the people to change their buying choices

Sanjay Desai & Ashish Mulani
True Colors

Digital textile printing will be the technology of the future

Prabu Mohanram
Balavigna Weaving Mills Pvt Ltd

The biggest challenge that the weaving industry faces is high price

Ravindra Jain, Ashish Baid

Oswal Prints Private Limited has been manufacturing and exporting ethnic...

Riddhi Jain

Conceived in Europe and curated in New Delhi, NeceSera is a...

Sugandha Bhardwaj

<div>New Delhi-based Brinjal Designs Pvt Ltd manufactures home furnishing...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Marcel Alberts

Coating at a fibre level is a practice not usually seen in the...

Marten Alkhagen
Swerea IVF AB

Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...

Sonam & Paras Modi

Sonam and Paras Modi's Sva Couture is synonymous with head-turning...

Mike Hoffman
Gildan Activewear SRL

Gildan Activewear, a manufacturer and marketer of branded clothing and...

Rupa Sood and Sharan Apparao

Nayaab, an exhibition meant to celebrate Indian weaves, is in its second...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies


Leave your Comments

May 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category

Related Categories:

Advanced Search