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Kenya seeks EAC nod to extend rice import tax relief

Business · Tania Wanjiku · June 13, 2025
Kenya seeks EAC nod to extend rice import tax relief
National Treasury CS John Mbadi at the National Assembly ahead of budget reading on June 12, 2025. PHOTO/NATIONAL ASSEMBLY
In Summary

The government’s move is aimed at securing an extension of the current tax break which allows rice to be imported at less than half of the bloc’s 75 percent common external tariff.

Kenya has applied to the East African Community Council of Ministers to continue importing rice at a reduced duty rate in order to maintain adequate food stocks and protect consumers from high prices.

The government’s move is aimed at securing an extension of the current tax break which allows rice to be imported at less than half of the bloc’s 75 percent common external tariff.

The application comes just after the EAC Council of Ministers granted a similar request from Kenya last month to extend duty remission for wheat imports.

In his 2025 Budget Speech, Treasury Cabinet Secretary John Mbadi confirmed that Kenya’s request for rice duty relief is part of ongoing efforts to ensure stable food supply across the country.

The EAC CET sets uniform taxes on goods brought in from outside the member states, which include Kenya, Uganda, Tanzania, Rwanda, Burundi and South Sudan. The relief, if approved, would allow importers to bring in rice at a lower cost, helping to meet growing local demand without putting pressure on consumers or local producers.

The government has already seen the benefit of this kind of arrangement through the wheat duty remission.

"Mindful of wheat farmers in Kenya, EAC ministers agreed on duty remission of wheat at a rate of 10 percent, instead of the CET rate of 35 percent, provided the millers who intend to import wheat under the duty remission must first purchase locally produced wheat," Mbadi said.

The government said the lower import duty has helped ensure sufficient wheat stock in the market while shielding Kenyan farmers from unfair competition.

Kenya relies heavily on imports to meet domestic demand for wheat and rice. Wheat-based foods like bread, chapati and cakes form a large part of the daily diet in many homes.

According to the Economic Survey 2025, Kenya’s wheat production last year increased slightly to 312,200 tonnes from 309,500 tonnes the previous year.

However, the output was still lower than the 368,700 tonnes produced in 2022 and the 349,100 tonnes in 2021.

The locally-produced wheat accounted for only 11.89 percent of the total 2.63 million tonnes of wheat stock available last year, with the bulk of the stock imported from outside the region.

This trend underscores why the government is keen to also ease rice import taxes in order to sustain national food reserves and avoid shortages.

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