Thursday was a good day for ugali lovers after the Government proposed to bring down the cost of maize significantly.
This is good news for the ordinary mwananchi for whom the cost of maize flour – used to prepare Kenya’s staple dish, ugali – has gone through the roof.
Reading the budget speech in Parliament, National Treasury Cabinet Secretary Henry Rotich proposed to allow duty free importation of white maize for four months.
Kenyans will be hoping that permission to import maize will not be abused to the extent of affecting Kenyan producers at some point.
Maize imports have always touched a raw nerve. Maize and wheat flour have also received a major tax relief after the Government decided to waive all taxes on the inputs used to manufacture the foodstuff. The decision goes addresses the worsening state of food security in the country – close to 3.2 million Kenyans in over 20 counties are facing starvation.
“Mr Speaker, ordinary bread and maize flour are VAT exempt, which means they do not benefit from deduction of input tax. Therefore, the input tax is built into their selling price.
“In order to make these commodities affordable for the common mwananchi, I propose to zero-rate bread and maize flour to remove VAT altogether,” said Mr Rotich, warning that should traders fail to comply, the Government would withdraw the incentive.