November 27, 2025
Kenya’s fresh produce growers and exporters, as well as the general agriculture sector, are calling on the government to create a more predictable and competitive environment to drive growth, investment, and job creation. In a policy statement for 2026, Ms. Disha Copreaux, Chief Executive Officer of Red Lands Roses SEZ PLC, outlined key areas where reforms could unlock growth and enhance the country’s global competitiveness.
“Kenya’s agriculture and horticulture sectors are ready to grow, but we need a predictable, competitive, and pro-investment environment,” said Ms. Disha in a LinkedIn Post.
Unlocking Cash Flow through VAT Reforms
One of the sector’s pressing concerns is the impact of value-added tax (VAT) on essential inputs. The recently introduced 6–7% VAT band has increased costs, while frequent changes in tax policy make financial planning challenging. Companies are also facing delays in VAT refunds, with some reportedly owed up to KSh 1.4 billion.
The sector proposes clearing VAT refunds through a 10-year infrastructure bond, which would free up working capital for farmers and exporters.
Reducing Compliance Costs
Exporters are also urging reforms to compliance requirements. They recommend capping Uniform Customs Receipts (UCR) fees at KSh 300 per UCR, with an annual cap of KSh 80,000. Additionally, the Kenya Bureau of Standards (KEBS) levy should not classify flower exporters as manufacturers, as this imposes unnecessary costs.
Predictable Import Levies
Unpredictable import levies are another challenge. For example, the 1.5% wheat import levy complicates planning for businesses reliant on imported raw materials. The sector recommends replacing variable levies with flat fees to create certainty.
Lowering Packaging Costs
Packaging costs are a key expense for exporters. Kenya currently imposes a 25% excise duty on kraft paper, despite the country having no local manufacturers. The sector is calling for a temporary reduction of the excise duty to zero until local production capacity is established.
Addressing Trade Disparities
Kenyan exporters are also struggling with trade disparities. For instance, Kenyan avocados face a 30% duty in some markets, whereas neighboring Tanzania pays no duty. These imbalances are prompting companies to relocate operations to countries such as Morocco, risking Kenya’s long-term competitiveness.
Ms. Disha Copreaux stressed that reforms in these areas would allow growers and exporters to focus on productivity and innovation. “Give us a predictable, stable tax and regulatory environment and Kenya’s farmers and exporters will do the rest,” she said.