This paper is a contribution to the current debate on the need for EAC harmonization of domestic taxes. It provides evidence on the
existing tax systems and identifies the current tax obstacles to cross-border investment within the EAC. The paper offers estimates
of the current effective tax rates on domestic and international corporate investment in the EAC. These estimates reveal substantial
variation in effective tax rates across EAC member states, particularly corporate income tax. The paper shows that most of this
variation can be traced to differences in statutory corporate tax rates. It consider the issue of tax base versus tax rate harmonisation
and discuss alternative routes towards an improved harmonisation of corporate (and consumption) tax systems in the EAC.