The ministry of agriculture has announced plans to roll out tax incentives in the tea industry to enhance production and value addition in the country.
Speaking during the Kenya Tea Development Agency (KTDA) directors conference in Nairobi, the Cabinet Secretary for Agriculture Mithika Linturi said the government is set to offer tax and other incentives to boost the tea sector.
Linturi said, “The concept note approved by the national treasury proposes the establishment of a scheme aimed at unlocking the potential of Kenya tea by providing both tax and other incentives necessary to make local value addition more attractive. “
He also added that “The scheme will also entail promotion of Kenyan tea brand and enhancement of the orthodox tea manufacturing.”
The government, through the ministry of agriculture, has been engaging stakeholders in the tea and coffee sectors since the William Ruto administration took office with an aim to improve operations in the two industries to ensure farmers reap the financial benefits.
Deputy President Rigathi Gachagua has been vocal about cartels and brokers in the sectors, accusing them of taking advantage of farmers and enjoying the financial benefits of the industries while farmers get peanuts.
In October this year, around 600,000 tea farmers in the country received the highest bonus payout amounting to Ksh 44.15 billion. KTDA also released Ksh 23.55 billion as monthly pay for green leaf supplied to the 54 KTDA factories, bringing the total amount to Ksh 67.7 billion compared to Ksh 62.89 billion earnings of last year at the same time.
In January, KTDA disbursed Ksh 5.5 billion to tea farmers.
The KTDA operates a two-step payment model where farmers are paid monthly, an additional interim payment (mini-bonus), and a final payment (bonus) based on the performance of each factory.
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