HIGHER LEVY ON FOOD AND CROP IMPORTS AND EXPORTS.

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A display of different food items in market.

The Agriculture and Food Authority (AFA) has announced that starting 01 July 2024, a new levy will be imposed on all food crop imports and exports that will apply to a wide array of food crops including cereals, legumes, roots, and tuber crops, specifically sweet potatoes, cassava, beans, cowpeas, peas, soya beans, rice, oats, maize, barley, wheat, and sorghum. 

This development is part of the Crops (Food Crops) Regulations 2019, which were gazetted on 31 December 2019. The regulations were formulated in collaboration with the Ministry of Agriculture and Livestock Development and various stakeholders to enhance the promotion, development, and regulation of the production, processing, and trade of scheduled food crops.

Importing cereals and legumes, the levy will be 2% of the customs value, while exporters will be required to pay 0.3%. Importers of roots and tubers will pay 1% of the customs value, with a similar 0.3% levy on exports. The regulations stipulate that the levy will be calculated based on the food crops’ free-on-board (FOB) value. Payment must be made at the point of entry or exit and completed by the tenth day of the following month. The payment can be made directly to the Authority or through an appointed agent. Failure to comply with these payment deadlines will result in significant penalties. Delinquent payers will incur an interest charge of 25% on the outstanding amount plus a compound interest of 12%.

The funds collected from this levy will be used for the operation of the AFA, the development of the food crops subsector, and other purposes as approved by the AFA. This initiative aims to bolster the agricultural sector by ensuring that adequate resources are available for it is sustainable development.

AFA has urged all food crop importers and exporters to take note of this new development and prepare to comply with the upcoming regulations. This proactive measure is seen as a critical step in enhancing the efficiency and regulation of Kenya’s food crop market, ultimately contributing to the nation’s agricultural growth.

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