KERUGOYA, Kenya, Feb 22 – Calls for government to scrap the ad valorem levy charged on Kenyan teas at the Mombasa Auction refuse to die down.
Kenya Tea Development Agency says the government should support tea farmers by lifting the 1% ad valorem tax to provide a fair playing ground for teas from the Eastern Africa Region.
KTDA Holdings Chairman, Peter Kanyago made the appeal Monday saying the tax charged on Kenya tea at the Auction makes it more expensive compared to tea from Rwanda, Burundi, Malawi, Tanzania and Uganda.
“This Ad Valorem tax makes our teas more expensive than those of other countries and, therefore, we appeal to the government to consider removing the tax,” appealed Kanyago.
Kanyago also requested the government, through the Ministry of Agriculture, Livestock and fisheries, to provide fertilizer subsidy to small scale tea farmers, whose farm sizes have continued to decline due to land sub division.
Speaking during the celebrations, Alfred Njagi, KTDA General Manager – Operations, said that the factory has grown over the years to be one of the biggest in Kenya, processing huge volumes of teas.
In a span of five years, Kangaita tea volumes have jumped up by 21% from 15 million kilograms of processed teas in 2009/2010 financial year to 19 million kilograms in 2014/15.
Its’ tea revenues have risen almost by a similar margin.
“In the 2014/2015 financial year, the factory paid a total of Sh806 million to tea farmers up from Sh704 million paid the previous year, with tea farmers earning Sh30.65 per kilo of green leaf as second payment compared to Sh23 earned the previous year.
The 25% increase in revenue earned demonstrates that tea farmers have continued to improve the quality of green leaf they supply to the factory,” he added.