Tanzania retains business permit fees for Kenyan companies


By George Omondi | Business Daily, Kenya September 26, 2017

Tanzania has retained business permit fees for Kenyan firms after nearly one year of gruelling negotiations.

The move is seen to symbolise the country’s lack of enthusiasm for the 18- year-old trade pact among East African Community member states.

Kenyan firms expanding or setting up subsidiaries in Tanzania have, however, won some relief after Tanzania cut the permit fee by half from Sh50,000 to Sh25,000.

Tanzania upset its integration partners with the November 2015 introduction of permit charges with the enactment of the non-citizen employment regulation Act.

The treaty, which took effect in 2010 demands the scrapping of visas and work permit fees charged on firms from neighbouring countries.

Kenya, Rwanda and Uganda have waived the work permit fees since 2013, leaving only Tanzania, Burundi and new entrant South Sudan with such restrictions.

Efforts to scrap work permit have since taken several rounds of negotiations including the July direct communication between President Uhuru Kenyatta and President John Magufuli and the September 8 meeting between Trade principal secretary Chris Kiptoo and his Tanzanian counterpart, Adolf Mkenda.

“Tanzania has revised business permit fees for EAC partner states to $250. The chiefs of immigration and labour commissioners will meet on October 31 to deliberate further on this matter,” Dr Kiptoo and Prof Mkenda said in a joint statement after their Dar meeting.

During the meeting, Tanzania also agreed to cut by three quarters the expatriate work permit fees charged on EAC firms that send non-Tanzanian staff to work in the country.

“Expatriate permit fees have been reduced from $2,000 to $500 per year, but this can further be deliberated at the level of immigration chief forum,” the two PSs said.

For non-EAC firms, Tanzania will continue to collect business fees at the rate of Sh25,000 and Sh10,000. Those who visit Tanzania for research will pay Sh25,000 for a class C permit, the statement added.

Kenya, however, maintains that permits and visa fees must be harmonised across East Africa.

The report on retention of the business permit fees comes as Kenya grapples with a 35 per cent drop in monthly export volumes to Tanzania compared to 2016.

Latest data from Kenya National Bureau of Statistics indicates that exports to Tanzania fell to Sh8.2 billion in the first five months of the year compared to Sh12.6 billion by end of May 2016.

Kenya has accused Tanzania of charging 1.5 per cent railway development levy on its products, over valuing its juices for tax purposes and banning its diesel re-exports to northern Tanzania.

Tanzania, on the other hand has accused Kenya of raising inspection fees on its trucks, failure to implement single customs territory tax collection model and causing border delays.

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