Plans to slap tax on food sparks outrage

• Prices of maize flour, bread and milk set to go up if MPs approve new VAT

Outrage on Tuesday greeted a proposal to impose a 16 per cent tax on basic commodities.

The Central Organisation of Trade Unions (Cotu), and other groups said the plan by the Treasury would spell disaster, with Cotu warning of a massive nationwide strike.

Secretary-general Francis Atwoli said the proposal by Finance Minister Njeru Githae to introduce the Value Added Tax Bill 2012 would push the prices of basics beyond the reach of the common man.

“This will result in one of Kenya’s darkest days due to a nationwide strike by workers and the unemployed,” he warned in a statement.

Prices of maize flour, bread, wheat flour, milk and other basics will shoot up by 16 per cent if MPs approve the proposal to slap a tax on them.

Also identified for additional taxation are agricultural inputs, which would push up food prices further.

Fertiliser, seeds, insecticides, pesticides, sanitary towels and tampons, exercise books, mosquito nets and local water-pumps, among a host of other items, would not be spared.

Yesterday, the Consumer Federation of Kenya waded into the row, saying, taxing basic good was not practical.

“We are concerned. This Bill is not being driven by the Treasury. It is being spearheaded by the International Monetary Fund, which wants the government to repay its loans,” the organisation’s secretary-general Stephen Mutoro said.

The president of the National Civil Society Congress, Mr Morris Odhiambo, condemned the proposal. “We are asking MPs to ensure that it doesn’t pass,” he said.

The Agrochemicals Association of Kenya also vowed to lobby MPs to reject the Bill.

“This Bill will take away all the gains we have made in improving food security as farmers will find it impossible to continue using available technology as it will be more expensive,” association chairman Kuria Gatonye said.

On Wednesday, dairy players are expected to present a petition to Livestock Minister Mohammed Kuti asking him to lobby his colleagues for an exemption.

Additional reporting by Peter Obuya