Billions Freed for Kenyan Farmers as Government Fixes VAT Refunds

These interventions were expected to release billions of shillings previously tied up in delayed refunds, enabling exporters and farmers to reinvest in high-value sectors such as horticulture, tea, coffee, livestock, and fresh produce..

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The Kenyan government is set to release billions of shillings to agricultural exporters and farmers through the upcoming Finance Bill 2026, addressing long-standing challenges in the export sector. These interventions aim to boost competitiveness and liquidity, enabling reinvestment in high-value agricultural sectors.

Agriculture and Livestock Development Cabinet Secretary Mutahi Kagwe announced comprehensive reforms, including cutting input VAT for exporters from 16 per cent to 8 per cent and scrapping excise duty on packaging materials.
The reforms will free up capital previously tied in delayed refunds, such as Flamingo Group Investments' outstanding KSh 1.8 billion, of which KSh 470 million has already been disbursed.
The announcement was made during the unveiling of Flamingo Group Investments' KSh 2 billion expansion in Naivasha, a project expected to create 500 direct jobs and expand flower exports to Europe and the United Kingdom.

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