KRA withholds duty-free sugar tax waiver data

duty-free sugar
Imported duty-free sugar at the Mombasa port in August 2017. FILE PHOTO | NMG 

The Kenya Revenue Authority (KRA) has declined to release information on how much tax Kenya forewent during the duty-free sugar import window opened in 2017.

The taxman maintains that the matter is still under investigation and would not reveal the amount foregone after two gazette notices that waived duty on sugar imports.

KRA Acting Commissioner Customs and Border Control Kenneth Ochola told the Business Daily that the exact duty the taxman could have collected from the sugar imports could not be provided now since Parliament is still reviewing the matter.

“The issue is still under review by the Parliamentary Accounts Committee (PAC),” said Mr Ochola in response to queries over the revenue impact of the controversial duty-free window.

PAC Chairman and Ugunja MP Opiyo Wandayi, however, said: “PAC acts only on the basis of the Auditor General’s report. We do not pre-empt his work. So far, the Auditor-General has not reported on this particular matter. Perhaps it will be captured in the 2017/18 report, which I yet to be presented.”


Another joint departmental Committee on Agriculture and Livestock and Trade, Industry and Cooperatives chaired by Kieni MP Kanini Kega released its findings on the sugar import saga in August last year.

The report was shot down in Parliament after it recommended an investigation into Treasury Cabinet Secretary Henry Rotich and then Agriculture minister Willy Bett over the duty-free sugar that flooded the local market, further straining Kenya’s struggling sugar sector.

Data from the Sugar Directorate shows that sugar imports increased by 196 per cent in 2017 compared with the previous year as traders rushed to ship in the duty-free commodity.

The volumes had nearly tripled from 334,109 tonnes in 2016 to 989,619 tonnes as more shipments docked at the Kenya port between May and August that year.

The Kanini Kega-led joint departmental committee found that traders took advantage of the window to import substandard sugar including those contaminated with mercury.

“From the samples collected from 45 counties by Kebs and laboratory analysis by the government chemist, contamination of sugar was majorly in moisture, yeast, moulds and total viable count and polarisation. Sugar contaminated with Mercury was detected in two samples; from Moi Airbase in Eastleigh, Nairobi and Webuye West in Bungoma County,” the report said.