A growing pushback has emerged against a newly introduced levy on tea exports, with lawmakers from tea-growing regions warning that the measure could cost farmers billions of shillings, weaken Kenya’s competitiveness in global markets and leave thousands of tonnes of tea unsold.
The legislators are demanding the immediate suspension of the 0.8 per cent export levy introduced by the Tea Board of Kenya (TBK), arguing that the additional charge is already affecting tea sales and driving buyers towards competing producers in the region.
The levy took effect on May 1 under the Tea (Levy) Regulations 2026. It imposes a charge equivalent to 0.8 per cent of the auction price or customs value for direct sales on all tea exports. The Kenya Revenue Authority has been appointed to collect the levy on behalf of TBK.
Led by Kirinyaga Senator James Murango, the lawmakers claim the country has already lost more than Sh3.1 billion in expected tea sales since the levy came into force. They say over 9,000 metric tonnes of tea remain unsold in Mombasa as buyers shift to alternative markets.
The leaders are now calling for consultations between the government and stakeholders, warning that they are prepared to seek legal intervention if the levy is not suspended.
“Why the rush? It does not make sense. If we don’t remove the levy, we will be left with no market,” said Murango.
“If the government does not suspend the levy to allow for talks, we will have no choice but to go to court to ensure the regulations are withdrawn.”
According to the Tea Levy Regulations 2026, issued under Section 53 of the Tea Act 2020, transit tea from six other countries trading through the Mombasa Tea Auction is exempt from the levy.
Lawmakers say the exemption has created an uneven playing field, with traders increasingly turning to tea from neighbouring countries. They noted that buyers at the Mombasa Tea Auction are showing greater interest in tea from Rwanda and Burundi, while Pakistan, Kenya’s largest tea export destination, has formally objected to the levy.
The Pakistan Tea Association has called for the levy to be suspended, saying it will increase import costs by about three US cents per kilogramme.
Murango said tea factories are already feeling the effects of the new charge, particularly those producing premium hand-picked tea in regions east of the Rift Valley.
He noted that during the latest auction, factories in the area recorded only 55 per cent sales, while factories in western Kenya achieved 88 per cent sales. According to him, buyers are increasingly purchasing lower-priced tea in bulk and blending it with premium varieties.
“Rukuriri Tea Factory, which usually sells for between Sh70 and Sh90 million at a single auction, sold for just Sh2 million. The same was recorded by Kimunye, Imenti, Makomboki and Kiegoi, among others,” he said.
“We are killing the tea that fetches the best foreign exchange rates for political expediency. You cannot stabilise prices if no one is buying the tea,” he added.
Murango warned that the levy could reduce farmers’ earnings by lowering bonus payments and increasing the volume of unsold tea.
Tea remains one of Kenya’s top foreign exchange earners and generated Sh218.7 billion in 2025.
“The cost will be transferred to farmers in the form of lower income from tea sales, as buyers will now opt for cheaper tea instead of premium tea.”
Nominated Senator Joyce Korir called on the Ministry of Agriculture to engage stakeholders and develop a lasting solution that protects both farmers and the tea industry.
National Assembly Committee on Delegated Legislation Vice Chairperson Gichimu Githinji said tea farmers deserve clear information on the purpose of the levy and how they are expected to benefit from it.
However, TBK has defended the levy, insisting that it will not reduce farmers’ earnings because the charge will be paid by exporters rather than producers.
The board projects the levy will raise about Sh1.42 billion annually from tea export and import activities. TBK says all the money collected will be channelled back into the tea sector to support price stabilisation, research, regulation and infrastructure development in tea-growing areas across the country.