Kenya Plans To Cancel Export Tax On Raw Materials And Leather Industry Will Suffer Heavy Losses

The proposal is part of the Kenya financial act of 2012, and if it is passed, it is expected to make local manufacturers.

The supply of leather has declined sharply, because the chamber of Commerce has turned to a more lucrative export market, which will aggravate competition in the raw material market.

Leather processors

The development committee, Simon en AAAA, said that if the proposal was passed, the Kenya leather industry would be hit hard. "Kenya can't export all the raw materials to countries that are far ahead of Kenya, and then look forward to the growth of the leather industry."

Leatherwear

Betty Ma Yina, chief executive of the Kenya Manufacturers Association, also believes that the abolition of unprocessed export duties will result in the result of a wrong decision.

Over the past eight years, the government of Kenya has promulgated many policies to help the leather industry develop.

In fiscal year 2004-2005, 20% of the export tax on raw materials was introduced. In fiscal year 2006-2007, the export tax on raw materials increased to 40%.

In the 2010-2011 fiscal year, the Ministry of finance of Kenya allocated 175 million shillings (about US $2 million 80 thousand) for the Kenya Leather Development Committee to set up a number of small and medium-sized leather factories in rural areas.

A leather bag

Kenya government data show that in 2011, the number of leather industry practitioners in Kenya reached 16 thousand, contributing about 9000000000 shillings (about US $107 million) to the economy of Hong Kong.