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Lack of export forms costs Kenyan flower sector millions

Kenya’s flower sector appears set to lose many millions of Euro in income due to a shortage of government forms which are used to apply for tax exemption. Exporters have run out of the required forms and will most likely see their products subjected to import duties as a result.

Issuing exporters with the Euro 1 and GSP forms used for exemption of import duty is a sole responsibility of the Kenya Revenue Authority (KRA). That department has failed to produce additional forms however, and estimates it will need up to four more weeks to finally have them printed.

The failure to supply the required forms has naturally resulted in nervousness among the country’s flower farmers and exporters. Kenya Flower Council CEO Jane Ngige estimates that the sector may well lose about Sh4.5 billion (close to 40 million Euro) a month if a solution is not found.

“The forms are used to determine the origin of goods to prove that the importing country has a bilateral agreement that allows duty-free entry into the receiving country,” Ngige explains. “Last week, Kenya was told enough is enough to a gentleman agreement that has been working for the past two years, where exporters and their agents agree to sidestep the requirement…” she elaborates.

Ngige alleges that the KRA is busy shifting the blame, meanwhile: “The government printer is unable to meet the demand of the bulk of the papers needed on a daily basis to facilitate the smooth export of flowers,” is what she says the agency’s response has been to her timely warnings.

She is now urging the Kenyan government to seek alternative methods of authenticating the country of origin of the all-important cut flowers.

Source: Capital FM Kenya

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