Good news for Kenyan households as Unga and bread prices set to drop

The government has introduced a duty-free importation of maize in the next four months and the removal of value-added tax on both bread and maize flour.

Ugali which is Kenya’s staple food is now expected to be cheaper following months of sky rocketing maize flour prices.

Ugali which is Kenya’s staple food is now expected to be cheaper following months of sky rocketing maize flour prices.

Rising inflation

The consumer price of flour had peaked at Sh130 for a two-kilogramme packet as food costs ballooned in the last few months as inflation in the beginning of the year shot up to nine percent.

While reading the 2017-2018 budget, CS Rotich said the two basic commodities (maize flour and bread) are expected to be cheaper after the exemptions, warning millers and bread manufacturers of a reversal should they fail to translate the benefits to the consumer.

“In order to make these commodities affordable for the common mwananchi, I propose to zero-rate bread and maize flour to remove VAT altogether.

"Manufacturers, wholesalers and retailers who sell such goods will be expected to reduce the prices of these basic commodities, failure to which, I will reverse the policy,” Mr Rotich said.

The Government expects to see a significant reduction of prices as soon as these measures start taking effect after the lawmakers sign into law the appropriation Finance Bill.

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