Manufacturers oppose proposed port levies

Manufacturers and shippers have opposed proposed levies by Mombasa County Government in its 2014/2015 Finance Bill.

Kenya Association of Manufactures (KAM) faulted the move saying that any arbitrary introduction of levies would lead to increase in prices for imports especially on raw materials.

Such charges, according to KAM, will automatically be transferred to the end consumers hence the rise in the cost of living.

“Taxation should be one way. Imposition of the port charges are not economically viable,” KAM, Coast chapter vice-chairman Jinal Shah, said during the public participation on the draft Finance Bill at the Government Training Institute.

The county in its draft Finance Bill 2014/15, has proposed a transport and infrastructure development levy of $2 per (Sh170) per metric tonne or $10 (Sh850) per the shipment, whichever is higher, to be levied on all marine cargo through the port.

The levy will be collected by the port managers once the bill is ratified and implemented.

Other than the transport levy, the county has also proposed a levy of $20 (Sh1,700) per tonne of all cargo passing through Mombasa. Other charges include inspection levy and licensing fees for import and export companies operating in Mombasa.

Shah said port charges as proposed by the county government were not viable. KAM expressed fears that the decision to impose tariffs on shipping lines would suppress manufactures forcing them to increase prices of their commodities.

However, the county government defended its decision to impose the development levy claiming that the Sh1,700 would help the county sustain its infrastructure noting that ferries and harbours were a devolved function.

Mombasa County Transport and Infrastructure Executive Mohammed Abass, said it was prudent to impose the levy as trucks from port were straining region’s road network. He said once the levies have been collected by Kenya Ports Authority, the county will waive the offloading charges at the go-downs, which the county has also proposed.

“We know that trucks, which carry goods from the port of Mombasa are the ones that have been destroying our roads and we need money to repair these roads. The port needs to support the county infrastructure,” Abass said.

There are fears that the plan to introduce pay transit levy may result in congestion and may be manipulated by the county government to bring about cartels like those in weigh bridges.