CS Moses Kuria writes to Treasury on removal of 35% duty on edible oils [Photo]

This move aims to support the local production of edible oils and ensure stable prices for essential household items in the country.

Dated June 20, Kuria’s letter highlighted the critical role played by the edible oils value chain in determining the overall cost of basic food commodities in the nation.

He explained that while the government has implemented measures to stabilize prices, the importation of crude oil, amounting to approximately Sh102 billion, continues to hinder the growth of local manufacturing in this essential sector.

Treasury CS Njuguna Ndung'u in Parliament to deliver the 2023/24 Budget Policy Statement Treasury CS Njuguna Ndung'u in Parliament to deliver the 2023/24 Budget Policy Statement Pulse Live Kenya

To address this challenge and promote local manufacturing in the edible oils value chain, Trade CS Moses Kuria also proposed the elimination of the 35% duty on crude oil.

Instead, he suggested implementing a 10% export and investment promotion levy on imported crude oil.

READ: How to choose the best cooking oil (out of 25 kinds)

This levy would be targeted at selected goods for which local manufacturing industries can produce. The goal is to encourage investments in domestic production and establish a fair pricing structure for edible oils.

According to Trade CS Moses Kuria, the proposed substitution would support local manufacturing and also contribute to the growth of palm, soya, and sunflower farming.

Edible oil You can elevate the flavor of your grilled cheese by smearing the outside of your bread with everything from olive oil to truffle oil. Werlin recommends always spreading or brushing the oil directly onto the bread, rather than in the pan, so that the bread gets evenly crispy.Whether you're using oil, butter, or mayonnaise, Werlin also recommends using a nonstick pan for cooking your grilled cheese sandwich and covering it to expedite the melting of the cheese. Business Insider USA

Impact of CS Moses Kuria’s proposal

Kenyan Manufacturers of Edible Oils

The removal of the duty on edible oils and the introduction of the export and investment promotion levy would provide a boost to local manufacturers.

With the elimination of the duty, the cost of importing crude oil, a major component in edible oil production, is expected to decrease.

This reduction in costs would enhance the competitiveness of domestic manufacturers and encourage them to expand their operations. As a result, Kenyan manufacturers would have a greater opportunity to meet the local demand for edible oils and reduce reliance on imports.

Consumers

The proposed measures have positive implications for consumers of edible oils in Kenya.

By supporting local manufacturing, the government aims to stabilize prices for essential household food items.

CS Moses Kuria writes to Treasury on removal of 35% duty on edible oils [Photo] CS Moses Kuria writes to Treasury on removal of 35% duty on edible oils [Photo] Pulse Live Kenya

With increased domestic production, there will be a more consistent and reliable supply of edible oils, reducing the dependence on imported products.

Stable prices and a secure supply of affordable edible oils would benefit consumers by ensuring access to a vital component of their daily diet.

Farmers

The introduction of the export and investment promotion levy would have a direct impact on farmers involved in palm, soya, and sunflower farming.

With the incentivization of investments in local manufacturing, there would be an increased demand for raw materials from these farming sectors.

This, in turn, would provide opportunities for farmers to expand their cultivation of palm, soya, and sunflower crops. The growth in these farming sectors would not only contribute to the local production of edible oils but also stimulate rural economies and create employment opportunities.

Economy

By reducing the dependence on imported edible oils, the government aims to strengthen the local manufacturing sector and boost the overall economy.

Increased domestic production is expected to generate employment opportunities, stimulate investments, and contribute to the country's Gross Domestic Product (GDP).

Additionally, by substituting the duty on edible oils with the export and investment promotion levy, the government aims to attract foreign direct investment and enhance the competitiveness of Kenyan industries in the global market.