The Kenya Flower Council Chief Executive Officer Mrs. Jane Ngige accompanied KFC Director Tim Ndikwe for a meeting with the Nakuru County Cabinet secretary Finance Mr. Francis Mathea to discuss the issues of devolution with the county government.
Mr. Mathea committed to facilitate further dialogue with the Country Cabinet Executives in the last week of December 2013, to raise awareness on the challenge and opportunities faced in aligning functions of the national and country government to the Constitution. In particular address facilitation of sustainable flower businesses, demand of taxes, levies and cess alongside attendant services, with a focus on productivity and competitiveness. The current Nakuru County Finance Bill is seeking to tax the flower industry at untenable rate of 1% on turnover.
Mrs. Ngige told the Cabinet Secretary that the industry embraces fully the newly devolved system of county government and recognizes the huge potential it has to support the floricultural sector. The industry also recognizes that county governments are charged with the responsibility of generating funds to supplement central government financing, and is eager to play its part in assisting this. With respect to cess / levies and taxes; the industry already makes substantial contributions through direct and indirect taxation, through voluntary contributions to community services and environmental activities, through the payment of wages which are more than 50% higher than the government minimum. As a result, there is very little leeway for additional costs to be absorbed.
The industry’s view is that these provisions need to be subjected to debate at national and county level to establish a consistent, coherent and accepted interpretation of legal requirements, thereafter rationalize, harmonize and expunge redundant demands, so that random interruption of the industry is avoided and that an appropriate mechanism for the industries’ contribution to the economy can be reflected at county and national level without over burdening the industry.
There is also need to acknowledge the scope of contributions that the sector already makes to the communities in which it operates. It would be important that a proper uniform mechanism be established for the counties that seek to collect the cess to do so in a manner that does not result in loss to the growers and exporters. By engaging in constructive dialogue, the floricultural industry believes that the issues raised can be resolved to the satisfaction of all stakeholders.