Kenyans to Pay More for Smokies as Taxes Bite

Lovers of smokies are likely to pay more for the commodity, after one of the leading sausage producers in the country, Farmers Choice, announced a possible price hike.

In a circular directed to all pig suppliers, Farmers’ Choice Pig procurement manager George Omari stated that the price increase will be due to double taxation of the products’ landing fees and cess.

“The Kenya Revenue Authority (KRA), acting on behalf of the Nairobi City County Government on revenue collection, has directed that cess/landing fees for all livestock received at our slaughterhouse be paid to the county government. Regardless of whether the same has been paid in the country of origin,” read the circular in part.

This means that all livestock received at the facilities will be charged a levy, regardless of whether they have been charged at their County of origin.

Farmers Choice, however, noted that the move went against its initial agreement which exempts Cess deduction with regards to livestock whose cess has been paid at the source.

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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 the circular.

The meat supplier indicated that the double taxation will force the company to hike its prices for the pork sausages, while they engage the county government with regards to the directive.

“Following this directive, please note we shall deduct the Cess as prescribed in the LPO, for remittance to Nairobi City County government. We are however appealing the directive, noting that the decision results in increased cost of doing business for all stakeholders. We shall keep you informed of the outcome of our negotiations,” added the notice.

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 one farmer.

The KRA has been at fault for imposing high taxes on businesses countrywide, which raises the cost of doing business in the country, leading to a hike in commodities.