High taxes threat to agriculture, forum cautions

Expensive inputs are hurting agriculture production. FILE PHOTO | NMG

What you need to know:

  • The costs of importing fertiliser, pesticides-making ingredients and farming equipment continue to rise, making many Kenyans continue engaging manual labour in agricultural productivity.

Agriculture will only lift the economy if government reviews taxation and halt misplaced commercial involvement in the sector.

A CBA economic forum heard that official intervention is destroying agricultural production while inputs remain too expensive. The costs of importing fertiliser, pesticides-making ingredients and farming equipment continue to rise, making many Kenyans continue engaging manual labour in agricultural productivity.

“Fertiliser prices have doubled, pesticides now attract a 16 per cent VAT levy while most farming equipment attract import duty. Farmers need direct incentives that make agriculture attractive as an investment option,” said Fresh Produce Exporters Association of Kenya chairman Harit Shah.

The Kenya Horticultural Council chief executive Jane Ngige supported exclusion of government in commercial agricultural activities across the entire value chain saying it had worsened the situation.

“The government enforced meeting of standards and did very well to promote flower and horticultural exports. It is now leading fresh market hunting missions in the Middle East, Asia and the East.

“We need similar practices in other agricultural sectors while letting the private sector take up an active role in production all the way to marketing,” said Ms Ngige.

She said farmers must grow market-driven crops which will promote establishment of a vibrant private sector-driven value chain.

“The days when we relied on government for any assistance from fertiliser, certified seeds to marketing are long gone.”

We need to look at new avenues where the market dictates how we practice commercial agriculture,” she said.

Welcome!

You're all set to enjoy unlimited Prime content.