Gachagua promises review of Finance Act after uproar from avocado farmers

Additionally, the Deputy President said a Task Force will be formed to look deeply into issues affecting the avocado subsector in order to make it more lucrative to the farmers.

Speaking on Tuesday when he hosted avocado industry stakeholders for a consultative meeting at his Karen residence, Gachagua said the government is working on pertinent interventions to safeguard the multibillion-shilling sector following farmers’ disquiet over imposition of new levies.

The DP said deliberations are ongoing on the review of a legal provision in the Finance Act 2023 spelling new taxes on Avocado and horticultural farming after farmers rejected it. 

“I have called a meeting tomorrow (Wednesday) with the Cabinet Secretaries for National Treasury and Agriculture, representatives of the fruit farmers, exporters and aggregators and the Kenya Revenue Authority so we can agree on the way forward in the implementation of the clause in the Act. We are a listening government and we value consultations,” he said.

He said the Members of Parliament had been made aware of the offensive clause asking them to look into removing it. 

“Discussions on the Finance Bill are ongoing and amendments will be made to reflect the reality of the sector. Members of Parliament will do their part,” the DP added.

The Deputy President said the taskforce will be tasked with coming with far-reaching remedies to the issues bedeviling the sub-sector.

Members of the task force will include fruit farmers, exporters, aggregators, marketers, exporters, ship line operators and government officials drawn from relevant ministries and departments.

“The taskforce will work in earnest and come up with remedies in 30 days so that we agree on what needs to be done. As an Administration we are ready to engage with stakeholders and ensure farmers are happy,” assured the Deputy President.

The Managing Director of Horticultural Crops Development Authority (HCDA) Christine Chesaro, told the forum that foreign income from avocado exports is on the rise. She said the value of the exports was Ksh.19 billion in 2023 up from Ksh.15 billion in 2022.

“Despite the challenges we are making progress. Murang'a is leading in production followed by Nakuru. We are at position six in global exports. However, we need to increase production to have sufficient volumes to export throughout the season,” she said.

The farmers and exporters said that avocado farming is a lucrative business but the sub-sector was facing myriad challenges including post-harvest management, marketing, low pricing, lack of traceability mechanism and access to the global market.

“Avocado farming is a lucrative business but small-scale farmers do not feel the economic power. The challenges include low prices dictated elsewhere without involvement of farmers, high production costs since the sub-sector is labour and capital intensive. The business is also infiltrated by middlemen and cartels sent by some exporters,” said Jeremiah Ng'ang'a, a farmer from Kigumo Murang'a County.

The Deputy President said he convened the meeting on instruction by President William Ruto. He added that the government is committed to streamline the agriculture sector.

“We are keen to ensure the sector is protected and it grows so that we can increase exports and farmers' earnings. Our economy starts with Agriculture and we will mobilize everybody to ensure we succeed,” he stated.

“As a Government we appreciate the role you play in this critical sector and your place in the economy. The sector is critical for our foreign income. Any disquiet in the sector gives us concerns. This is a consultative government,” he told the participants.

Cabinet Secretaries Simon Chelugui (Cooperatives and SMEs) and Rebecca Miano (Trade) together with Principal Secretary State Department for Crops Development, Dr Paul Ronoh were present.

MPs Mary Wamaua (Maragua), Wakili Edward Muriu (Gatanga), Kamau Munyoro (Kigumo), Chege Njuguna (Kandara), Chairperson of the National Assembly Committee on Agriculture and Livestock Dr John Mutunga (Tigania West MP) and Kirinyaga Senator Kamau Murango, who is also Chairperson of the Senate Committee on Agriculture, were also present.