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KRA boosts flower exports with Sh10bn in tax refunds
A woman sorts out flowers at a farm in Nakuru County.
What you need to know:
- Kenya Flower Council chief executive Clement Tulezi said its members had received Sh10 billion owed to them in tax refunds by the state.
- Orders from the US, France, Germany and the UK have fallen significantly, affecting performance at the key auction.
The Kenya Revenue Authority (KRA) has refunded 70 per cent of tax claims by flower export firms, boosting liquidity for the agricultural producers amid cash flow challenges caused by the Covid-19 pandemic.
Kenya Flower Council chief executive Clement Tulezi said its members had received Sh10 billion owed to them in tax refunds by the state.
“At least from the exporters of cut-flowers, they were paid 70 per cent of what the government owed them, and that has continued to flow,” he said.
This comes at a time when Kenya’s flower orders at the Royal FloraHolland’s auction in the Netherlands has dropped by 20 per cent as European countries shifted priority to essential items such as food amid fresh lockdown due to resurgence in Covid-19 infections.
Orders from the US, France, Germany and the UK have fallen significantly, affecting performance at the key auction.
“If flowers are not on shelves, buyers (retailers and supermarkets) are not placing orders until they are assured they will be able to sell,” Mr Tulezi told the Nation last week.
However, he said, they were in touch with the KRA to expedite the payment of the balance.
Sh10 billion tax refund
“We have harmonised the balances from our end with also what KRA is looking at. We are happy with the progress at the moment,” he said. In March, President Uhuru Kenyatta announced a Sh10 billion tax refund for companies.
In a letter addressed to the Kenya Private Sector Alliance on June 12, 2020, the taxman announced that it had paid Sh21.4 billion value-added tax refund claims.
At the same time, a second wave of lockdowns due to resurgence of the Covid-19 menace is beginning to ail Kenya flower firms. Among countries that have resorted to the measure include Britain and France.
Mr Tulezi said direct sales to France would suffer irreparably due to the lockdown.
“The flower industry urges the Kenyan government to urgently engage the French government to safeguard jobs for thousands of workers who are likely to be the first casualties,” he said in a statement.
