Kenya’s flower industry stakeholders are calling for urgent reforms in the taxation regime, citing mounting costs that threaten the sector’s competitiveness in the global market. The Horticultural Crops Directorate (HCD) has raised concerns over the $10 standard fee per consignment introduced mid-2023 by the Kenya Trade Network Agency (KENTRADE), saying it disproportionately affects small-scale exporters.
According to HCD Director Christine Chesaro, the flat fee structure is squeezing the profit margins of smaller exporters, making Kenyan flowers more expensive internationally. The impact of increased taxation was evident in 2024, with the country’s cut flower export earnings declining by 2 percent to Ksh 72 billion.
“The $10 levy may seem small, but for small exporters who ship multiple small consignments, the costs add up quickly,” Chesaro said, noting that the tax is currently under review. Exporters are lobbying for a shift to a quantity-based taxation model, which they argue would be fairer and better aligned with their revenue.
The Kenya Flower Council has also echoed these sentiments, calling for the harmonization of more than 50 taxes and levies currently imposed on flower farms and traders. Industry leaders warn that the complex and burdensome tax environment could erode Kenya’s competitive edge as a global floral powerhouse.
Despite the challenges, there are signs of innovation and reform aimed at bolstering the sector. Breeders and growers are set to begin receiving royalties for newly engineered flower varieties, a move expected to enhance the quality and diversity of Kenya’s floral offerings. The Kenya Plant Health Inspectorate Service (KEPHIS) is also rolling out an electronic phytosanitary certification system. This initiative aims to enhance traceability and reduce interceptions of Kenyan flower consignments in key international markets.
These developments come ahead of the 12th International Flower Trade Exhibition scheduled for May 31, where industry players are expected to discuss the way forward for Kenya’s flower industry amid a shifting global trade landscape.
Kenya remains one of the world’s top exporters of cut flowers, and stakeholders are keen to ensure the sector remains vibrant, innovative, and competitive.
