CS Kagwe defends Tea Levy as uptake hits record 93%

Agriculture Cabinet Secretary Mutahi Kagwe has dismissed concerns that the Tea Levy is crippling Kenya's tea industry, revealing that tea uptake has surged to 93 per cent, the highest in years.

Speaking in Kirinyaga County on Thursday, CS Kagwe maintained that the levy is critical to financing research, global marketing and value addition that will secure the sector's future.

"Tea uptake has increased to 93 per cent compared to the levels witnessed three years ago. It is therefore not true that the Tea Levy has caused a glut," CS Kagwe said.

He argued that the 0.8 per cent Tea Levy is not imposed on farmers but on tea buyers, and will market Kenyan tea in new and emerging export destinations, fund research into improved tea varieties, strengthen climate resilience and promote value addition.

"Where will the money to promote Kenyan tea in international markets come from if we refuse to support the Tea Levy? Let us be honest, it is not the farmer paying this levy, it is the buyer," he stated.

CS Kagwe maintained that sustainable financing is essential to increase farmer earnings, arguing that Kenya cannot expect to remain the world's leading exporter of black tea while underinvesting in market development.

He noted that ageing tea bushes have continued to reduce yields and quality in many tea-growing areas, making research into new, high-yielding and climate-resilient varieties more urgent than ever.

To demonstrate the government's commitment to value addition, Kagwe officially handed over a Ksh.360 million JICA-donated Japanese Sencha Green Tea Processing Factory to Kangaita tea farmers after the project remained idle since 2019 due to an ownership dispute.

"This factory now belongs to the farmers of Kangaita. We could not allow such an important investment to remain dormant while farmers waited to benefit," he said.

The facility is the only factory in Africa producing authentic Japanese Sencha green tea, positioning Kenya to tap into premium global speciality tea markets where prices can reach up to USD 10 (Ksh.1,290) per kilogramme.

CS Kagwe said the investment represents the future of Kenya's tea industry through technology transfer, and increases export earnings but also create employment opportunities for young people.

"The children of tea farmers must also benefit from this industry. Value addition creates industries, creates jobs and ensures the next generation sees agriculture as a profitable enterprise," Kagwe added.

CS Kagwe reaffirmed the government's commitment to investing Tea Levy proceeds back into the sector through research, market promotion, innovation and farmer empowerment, saying the ultimate beneficiaries will be tea growers across the country.

Information released by the Ministry of Agriculture and the Tea Board of Kenya (TBK) intimated that the Tea (Levy) Regulations, 2026 came into effect on May 1, 2026, after being gazetted on April 1.

The regulations are made under Section 53 of the Tea Act, 2020 and effectively restore a levy that existed in a different form until 2016.

The government says the levy will not be charged directly to tea farmers and exporters will instead pay 0.8 per cent of the auction value of tea exports, or the customs value in the case of direct sales.

Tea importers, meanwhile, will pay a levy equivalent to 100 per cent of the value of imported made tea. 

The government describes the import charge as a protective measure designed to shield Kenyan tea producers from low-cost imports that could depress local prices and damage the reputation of Kenyan tea.