Uganda and Tanzania have instituted a ban on the tax-free importation of confectionery items from Kenya against the East Africa Community (EAC) regulations.
The two nations have cited the use of industrial sugar in the sweets as their primary reason for the ban.
According to Kenya's neighbours, chocolate, ice cream, biscuits and sweets made by Kenyan companies cannot be certified to be locally made when one of the ingredients is imported.
The two nations have since rejected a certificate of origin issued by the Kenya Revenue Authority (KRA) stating that the items are a product of Kenya.
[caption caption="File image of Presidents Uhuru Kenyatta, Uganda's Yoweri Museveni (centre) and Tanzania's John Magufuli (right) "]
[/caption]
Tanzania and Uganda have demanded that a 10 percent duty be levied on the Kenyan items to ensure that locally manufactured items are not at a disadvantage in the market.
Manufacturers from Kenya have accused the two nations of discouraging trade in the regions.
They further argued that none of the East African states produces industrial sugar that is essential in the manufacturing process.
"This is an EAC-wide remission scheme that is available to all manufacturers in the region.
"We are not supposed to pay duty when we sell in the region because our competitors in the region also rely on industrial sugar imported under the same remission scheme," Kenya Association of Manufacturers (KAM) chief executive Phyllis Wakiaga explained.
KRA exports officer Julius Kihara echoed the manufacturers' sentiments adding that the items are not liable to tax as long as trade volume is within the prescribed regional quota of 20,000 metric tonnes.
"We seek to clarify that upon records held by KRA, the products are not affected by legal notice No.4536 which applies to white sugar for home use," a letter written by Mr Kihara to Uganda and Tanzania tax authorities read in part.
[caption caption="KAM CEO Phyllis Wakianga"]
[/caption]
