Cane farmers are up in arms against the introduction of income tax on cane hauled to the sugar factories for milling.

The growers are not happy that despite advising the government to waive the tax, Kenya Revenue Authority (KRA) still went ahead to impose the duty, which comes into force as from January 2024.

Consequently, they have written a protest letter to Agriculture Cabinet Secretary Mithika Linturi, saying they will not accept such tax deductions on cane transported and delivered to the factories before milling.

They have also written to the Commissioner for Revenue on income tax, saying that farmers are not ready to comply with the new tax edict.

KRA had proposed in what is billed as sale of sugarcane by non-VAT/ETIMs registered farmers in the controversial Finance Act,2023, in its renewed bid to bring everyone into the tax bracket. Yesterday, officials of Kenya National Federation of Sugarcane growers led by Secretary General Killion Osur said the action is going to cause double or even multiple taxation of farmers’ income per capita.

“We are charged on everything, from planting, seedcane, fertiliser, harrowing to harvesting,’’ claimed Osur.
National Treasury in the 2023 Finance Act, proposed to raise the cost of pest control products at a time Kenya wants to cut production costs.

Under the proposals, the Treasury wants to move all inputs and raw materials supplied to manufacturers of agricultural pest control products.

Currently, both fertilisers and pest products fall in the zero-rated category. Osur said farmers are charged for inputs, fertiliser, harrowing and supplies of seed cane and cane development by the millers. – Kepher Otieno