Linturi defends tax waiver on maize, rice and sugar imports

Agriculture CS Mithika Linturi when appeared before the Senate plenary on June 21, 2023. [Elvis Ogina, Standard]

Agriculture Cabinet Secretary Mithika Linturi has said the government issued tax waivers on importation of 1.4 million metric tonnes of maize, 1.1 million metric tonnes of rice and 280,000 metric tonnes of sugar.

Mr Linturi appearing before the Senate plenary on Wednesday noted that as per June 16, 68 companies had imported 520,426 metric tonnes of white milled rice, while 13 companies had imported 234,981 metric tonnes of white maize.

The CS told the House that his ministry officials met with pre-qualified importers of maize and rice on April 25 to review and get an update on status of importation of the commodities where they raised challenges facing them.

"The challenges faced by importers during importation included appreciation of the dollar against Kenyan shilling, high international prices and off-taker guarantees required by banks to issue letters of credit," he said.

He said it was resolved during the meeting that importers unable to provide evidence of importation process such as bills of landing, surrender their import allocation and their permits were to be terminated.

Linturi noted that Kenya recorded the lowest maize production in 10 years estimated at 34.4 million bags against a national consumption requirement of 50 million bags due to drought.

He said based on the food situation early warning reports, the ministry recommended importation of various food commodities to bridge the food deficit and stabilise high prices with a public notice issued on December 14, 2022, inviting eligible millers and traders to make submissions.

"A total of 461 applications were received of which 186 did not meet the criteria for prequalification with 275 applicants being responsive and were given opportunity to participate in importation of food commodities with allocation letters issued to 129 companies to import rice and 127 companies to import maize," said Linturi.

The CS said the ministry is sensitising farmers to increase food production with several incentives in place to support them.

Linturi said there are 650,000 small-scale tea farmers in the country and the government is committed to improve the sector and resolve the crisis caused over tea-plucking machines.

"We need to appreciate that mechanisation of agriculture is the way to go with ministry promoting it, however, we have to implement the processes gradually with people prepared to accept them," said Linturi.