Structure of CET
- The CET includes the General Rules for the Interpretation of the Harmonized System, abbreviations and symbols, Section, Chapter and Subheading Notes, and the headings and subheadings.
- Each heading is identified by four digits, the first two indicating the Chapter number and the second two the numerical order in which the heading appears within the Chapter.
- The heading numbers are shown in the first column.
- The second column contains the eight-digit codes of the Harmonized System as transposed at the EAC level.
- The third column contains the text of the headings in bold and the texts of subheadings.
- The fourth column contains units of quantity for use when reporting statistics based on the Harmonized System.
- The fifth columns contain applicable Common External Tariff rates.
- The Handbook comprises Schedule 1 with duty rates under the three-band tax structure and Schedule 2 with duty rates of sensitive items.
- The fifth column of Schedule 1 contains applicable Common External Tariff rates and where the abbreviation “SI” (Sensitive Items) appears the applicable duty rates shall be those specified in Schedule 2.
- The CET is based on the following legal framework: –
- Article 8 (in respect of the HS) and article 12 (in respect of the tariff bands and among other things) of the Protocol establishing of the East African Community Customs Union,
- The East African Community Customs Management Act (EACCMA) 2004 which also support Rulings of Commissioners,
- The WCO HS convention,
- The council and summit decisions.
Types of Duty Rates
- Ad-valorem
This type of rate of duty is based on % of Customs value for example (Cost, Insurance and Freight) depending on the incoterms used. The advantage with this rate of duty is that it is easy to apply and protects the tax base from inflation.
- Specific
This type of rate of duty is based on unit of quantity. The advantage with this rate of duty it is unresponsive to downward prices and not subject to Customs value manipulation.