German company Strabag International has suspended works at the Sh8 billion Thiba Dam over a tax row.
The project is being undertaken in Mwea Irrigation Scheme in Kirinyaga County was meant to secure the year-round water supply to boost agriculture.
The 40-metre high and one-kilometre-long dam being built about 130km northeast of Nairobi was meant to create a reservoir that would allow a second harvest every year in the surrounding cultivable area.
The project contract value is worth about €72 million (Sh8 billion) and includes the connection to the existing road network as well as facilities for water draw-off and safe floodwater drainage. The construction of the dam started in March 2018 and was scheduled to last around 45 months.
“Thiba contractor has suspended the project. There are three certificates that have not been honoured. The project is tax exempt but levies have been paid. The contractor wants the tax exemption to be sorted out by the Treasury." said Crop Development and Agriculture Research PS Hamadi Boga
“The contractor packed his equipment and he is waiting for payment to be made and Kenya Revenue Authority tax issue to be sorted. We are asking our full budget to be released.
“Once this money is paid, the project will start. The project is currently 24 per cent and the period that has lapsed is around 34 per cent," Prof Boga told the Committee of the National Assembly on Agriculture.
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