CAMEROON – The Cameroon government has offered a special customs incentive to rice importers, allowing them to import 190,000 tons of rice from India duty-free.

The measure involves an exemption from a 5% import duty that the government allows for strategic consumer products, including rice, fish and wheat.  

This decision follows a consultation meeting held on February 21, 2024, in Yaoundé, between the Minister of Commerce, Luc Magloire Mbarga Atangana, and the concerned economic operators.

According to the executives, the tax exemption on the upcoming shipment of 190,000 tons of Indian rice aims not only to ensure the availability of this staple food but also to control its price on the local market amid escalating inflation.

According to the General Directorate of Taxes at the Ministry of Finance, however, through fiscal measures such as tax reductions or exemptions, the Cameroonian government forgoes around CFA52 billion (US$12.26 million) annually to ensure a steady supply of rice at an affordable price.

Historically, rice in Cameroon, one of the main import products that affect Cameroon’s continuously negative trade balance, has been taxed at a reduced duty rate of 5%, instead of the standard 20%.

However, in recent years, there has been governmental discourse on reducing or even eliminating fiscal expenditures on mass consumption products like rice, fish, and wheat.

The government believes that these products have led to significant revenue losses, becoming unbearable for the public treasury (nearly CFA1,000 billion in revenue losses from 2016 to 2022 for the three products).

From this perspective, the government’s decision to exempt 190,000 tons of Indian rice from import duty raises questions.

Financial experts, in addition, state that the move exacerbates the country’s revenue losses on a product already under-taxed (5% instead of 20%), in a context where the government is striving to increase its non-oil revenues; and the exemption is applied to a specific shipment rather than all rice imports, potentially creating unfair market competition.

The government, however, noted that the shipment benefiting from this exemption is the result of a special allowance made to Cameroon by India, after it (India) banned the export of its non-basmati white rice and broken rice on July 21, 2023.

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