Posted on September, 25, 2018 at 10:36 am
Traders have been warned against increasing maize flour prices because of the eight per cent tax imposed by the government on petroleum products.
Agriculture CS Mwangi Kiunjuri no one should hide behind the tax to increase prices.
He said he will meet with millers this week to discuss new prices. Kiunjuri said traders selling flour at more than Sh85 will be arrested and prosecuted.
“The government is taking stock of all traders and necessary action will be taken against those who have increased maize flour prices,” Kiunjuri said.
He spoke in Othaya, Nyeri county, during the opening of Kirai AIPCA church. The church was built at Sh17 million. Kiunjuri was the chief guest.
The price of unga soared to almost Sh150 last year following drought.
The government offered a subsidy to millers and capped the prices at Sh90 for a 2kg packet.
“By that time, the price of a 90kg bag of maize was between Sh3,000 and Sh3,200 and the millers were saying the price of maize was very high,” Kiunjuri said.
The CS said unga prices have stabilised.
“The government will not allow anybody to take advantage of the situation and hide behind the eight per cent increment of VAT on fuel to increase prices of unga.”
He said millers have no reason to increase prices because maize is currently selling at Sh1,500 for a 90kg bag.
The CS said the prices should even be lowered in line with the decrease in the prices of maize. He said he had already met large scale millers and discussed the matter.
Kiunjuri said the country had a good harvest and is expecting a bumper one again this season.
“So there should be noshortage of maize or any crop at the moment,” he said.
More than 94 small-scale millers met in Nairobi two weeks ago and resolved to raise the price of the 2kg maize packet from Sh90 to Sh98 owing to the 16 VAT fuel levy effected by Treasury CS Henry Rotich.
The tax has since been reduced to eight per cent by President Uhuru Kenyatta.
The National Assembly adopted the President’s proposals last week.
The millers said they would increase the prices by at least Sh4. Chairman of United Grain Millers Association Peter Kuguru said they increased the price because of the high cost of production.
In an interview with the Star last week, Kuguru said they will share the fuel levy with customers to reduce the burden.
"The price will remain so if we get a bumper maize harvest," Kuguru said.
Source: The Star