The government has defended the newly introduced tea levy, saying the measure is aimed at revitalizing Kenya’s tea industry and improving returns to farmers through increased market access, research, infrastructure development and stronger regulation.
In a statement, the Tea Board of Kenya (TBK) said the Tea (Levy) Regulations, 2026 were designed to create a sustainable funding model to address longstanding challenges affecting the sector.
“The government is revitalising the tea industry in order to ensure the competitiveness of Kenya tea,” the board said in the statement signed by Chief Executive Officer Willy Mutai.
The levy, which took effect on May 1, 2026, imposes a charge of 0.8 percent of auction value or custom value for direct sales at the point of export.
Tea imports will also attract a 100 percent levy on the import value of each consignment of made tea.
According to TBK, the levy is provided for under Section 53 of the Tea Act, 2020 and was operationalised through Gazette Notice No. 82 published on April 1, 2026.
The board noted that the levy would not be borne by tea growers but by consumers through exporters and importers.
“This being an export and import levy, it is being borne by the consumers but payable by tea exporters/importers and not by the tea grower,” the statement said.
TBK said the levy translates to approximately Sh2.28 per kilogramme of made tea and argued that similar charges exist in other tea-producing and consuming countries including Sri Lanka, India, Bangladesh and Pakistan.
Under the regulations, 50 percent of the levy collections will go towards income and price stabilisation for tea growers, 20 percent to research, 15 percent to infrastructure development and another 15 percent to regulation of the sector.
The board cited low tea prices, weak market promotion, limited value addition, declining quality and inadequate research as some of the persistent challenges affecting the industry.
To address these concerns, the government plans to use the levy to expand Kenya’s tea market in regions such as China, West Africa, Russia, North America and Asia.
TBK said the strategy will involve enhanced marketing campaigns and establishment of warehousing hubs in key emerging markets including the Democratic Republic of Congo, the United Arab Emirates, Ghana and China.
The board also said the levy would support value addition initiatives aimed at increasing exports of packaged, branded and specialty teas instead of bulk tea exports.
“Supporting value addition initiatives aimed at reducing overreliance on bulk exports and increasing the proportion of packaged, branded and specialty teas exported from Kenya will enhance earnings of Kenya tea farmers,” the statement said.
Further, the levy is expected to support tea research, product diversification and enforcement measures against malpractices in the sector, including counterfeiting of premium Kenyan tea brands and exploitation of farmers.
TBK announced exemptions for value-added teas packed in containers of not more than 10 kilogrammes, tea extracts, tea aromas and tea processed in Export Processing Zones and Special Economic Zones for local consumption.
Meanwhile, the board said it had received requests from exporters seeking exemption for teas purchased before the levy took effect.
“In view of this, TBK on 4th May 2026 issued a circular to all tea exporters indicating that the Board will consider refunding the tea levy for amounts paid by tea buyers/exporters in respect of teas purchased between 1st January 2026 and 30th April 2026,” the statement said.
The government said it would continue engaging stakeholders to find lasting solutions to challenges facing the tea sector in line with the Bottom-up Economic Transformation Agenda.