Smokie Tax: Farmers Choice Protest KRA Directive

A new directive by the Kenya Revenue Authority (KRA) acting on behalf of the Nairobi county government has Farmers Choice and their pig suppliers up in arms.

KRA is authorized to collect revenues on behalf of the county. Farmers Choice wrote to all its pig suppliers informing them of the taxman’s latest directive –  that payment of cess or landing fees for all livestock received at the firm’s slaughterhouse be paid to the Nairobi county government regardless of whether the same has been paid in the county of origin.

Various stakeholders including farmers protested the move, maintaining that it amounts to double taxation. Someone delivering pigs to a Nairobi slaughterhouse from Kajiado, for instance, will be charged cess twice.

Notably, the pig movement permits per head in Nairobi cost more than in most rural counties, further adding to the suppliers’ frustrations.

Farmers Choice, one of the largest producers of meat products in Kenya, maintained that the move by KRA contravened a prior agreement they had in place.

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“This is contrary to our earlier agreement which exempts cess deduction for livestock whose cess has been paid at source,” they noted in a statement.

The firm, however, noted that they would start deducting the cess as prescribed in the LPO for remittance to the Nairobi county government from February 1st, 2022. They further announced plans to appeal the decision highlighting the impact it would have on stakeholders.

“We are however appealing the directive, noting that the decision results to increased cost of doing business for all stakeholders. We shall keep you informed of the outcome of our ongoing negotiations,” the firm asserted.

Farmers among other Kenyans called for Nairobi county and KRA to reconsider the move, noting that it would be detrimental to their earnings.

“This will amount to double taxation to farmers who might have paid Cess at County of origin before delivering Pigs to Farmers Choice, then they’re slapped with another Cess – Are farmers a joke to you?” posed Caleb Karuga.

“The cost of doing business in Kenya is at an all-time high, farming will impoverish you, even putting up a poultry barn will see County officials come to claim their cut,” opined Gismwas.

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