The Kenya Revenue Authority has confirmed the resumption of payment of cess by millers in Nairobi at their premises, effective 4th April, 2022.
In a letter addressed to the Council dated 22nd March, 2022, the authority further clarified that the payment of the cess will be levied from the members of the Cereal Millers Association(CMA) only, leaving out many other millers in the county in what is seen as a discriminatory move that will eventually pave way for competitive disadvantage to CMA members against non-members.
The resumption follows a suspension of a notice issued to grain millers in Nairobi County noting that KRA would be collecting the market cess on behalf of the Nairobi City County Government(NCCG) for all grain deliveries to millers’ premises effective 1st December 2021.
Upon receiving the notice, EAGC and the Cereal Millers Association convened a stakeholder meeting with KRA on 30th November 2021. The meeting resolved:
- EAGC and CMA to make a submission to KRA and Nairobi City County Government on cess imposition, collection and the concern on the double taxation
- EAGC, CMA, Cereal Growers Association (CGA) and the Association of Kenya Feed Manufacturers (AKEFEMA) to engage KRA and Nairobi City County Government for a follow up clarification meeting on the legality of cess collection as well as clarification on the Act of parliament and County Finance Act under which cess should be charged
- To avoid double payment of the cess by traders supplying and millers who are supplied, the demand notice by KRA to millers will be reviewed and not effected as earlier communicated
Following the resolve, a follow up meeting between EAGC, KRA, NCCG held on the 10th Dec. In the meeting, it was agreed that EAGC makes a submission to the Nairobi City Council, which was revising the Nairobi City Council Finance Act and would later open it for public review. EAGC then made the submission of 17th March. Since then, no formal feedback has been received, and neither has the cess matter been resolved by NCCG nor by KRA. The City Finance Act has since been gazette, with the collection of cess still present in the Act.
EAGC has since requested for further discussions with the County Executive Committee Member (CECM) Finance and Economic planning to find an appropriate way forward. EAGC will update Members on the progress made.
