Countries in the EAC/Africa region with favorable initial conditions of larger tax base tend to “race to the bottom” by lowering tax rates so as to create a pro-business environment. In contrast, some countries have difficulty in competing with others in the region to attract investment. Their domestic revenues are sometimes barely sufficient to cover their debt obligations. Consequently, they have resorted to levy heavy taxes on existing enterprises, worsening the business investment environment, which in turn affect their fiscal stance.