chapter
fiscalproblems has worked remarkably well. Part of the reason for
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Since 1961 there has been a measure of fiscal compensation to Uganda and Tanzania to offset the unequal territorial distribution of benefits flowing from the existence of the common market. According to the scheme, 40 per cent of the proceeds of income tax charged to companies on profits arising from manufacturing and finance, and 6 per cent of the annual revenue collected in the three countries from customs and excise duties are paid into a 'distributable pool.' Onehalf of the total receipts of the pool are distributed to the East African Common Services Organization to finance its non-selfcontained services, while the other half is shared in equal parts among the three countries. This results in a redistribution of revenue from Kenya to Uganda and Tanzania of about £0 • 8 million or so.