West Africa starts implementing the Common External Tariff

21 January 2015

Regional Integration has taken a new step in West Africa as 15 States of the Economic Community of West African States (ECOWAS) have started to implement the Common External Tariff (CET). Approved by the Extraordinary Conference of Heads of State and Government held in Dakar on 25 October 2013, the CET of the ECOWAS came into force – as well as all the regulatory texts that accompany it – on 1 January 2015, thereby giving effect to the Customs Union of West Africa. 

Through the entry into force of the CET, the countries of this region are standardising the tariff treatment of goods entering the community, thereby nullifying all domestic national legislations of the ECOWAS Member States as well as the CET of the West African Economic and Monetary Union (WAEMU), effective since 2000.

The CET of the ECOWAS is made up of five tariff bands where goods are taxed based on the category to which they belong.  As such, essential social goods (medicine) classed in the 0 category are taxed at 0 percent with 85 tariff lines, while essential commodities, basic raw materials, capital goods, specific inputs, classed in the first category, are taxed at 5 percent with 2146 tariff lines. Inputs and intermediate products (classed in the second category) are taxed at 10 percent with 1373 tariff lines. Final consumer goods (classed in the third category) and specific goods for economic development (classed in the fourth category) will be taxed at 20 percent with 2165 tariff lines and 35 percent with 130 tariff lines respectively.

The implementation of the CET by the ECOWAS Member States will ensure a status quo for a period of five years. During this time period, countries must effectively organize the convergence towards a single rate in order to ensure equal contributions from Member States to regional integration efforts. Taking advantage of this flexibility, Côte d’Ivoire has decided to maintain the rate of 20 percent (instead of 35 percent) for duties and taxes applied to the import of meat from third countries.

The regulatory texts adopted along with the CET include: the trade defence measures, which consists mainly of safeguard measures to restrict imports of certain products temporarily;  countervailing duty levied to counteract the effects of subsidies; anti-dumping measures to counteract unfair practices; additional protection measures. These consist of two taxes: 1) the adjustment duty on imports allows adjustments to be made to the tariff level by differentiating between the rate of customs duty in the CET-ECOWAS and the rate of customs duty that was levied in the CET-WAEMU. The adjustment can be made upwards (when the customs duty listed in the CET-ECOWAS is less than the previous customs duty). 2) the supplementary protection tax (SPT) – a surtax to the CET-ECOWAS – is applied to products imported from third countries in two cases: when the volume of imports of a product in a year increases by more than or equal to 25 percent than the average of imports of the last three years, or when the average CIF (Cost Insurance Freight) price over one month of an imported product falls below 80 percent of the average import prices of the last three years.

EndaCacid reporting

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