The Tea Board of Kenya (TBK) has begun implementing the Tea (Levy) Regulations, 2026, recently published under the Tea Act (CAP 34), aimed at supporting infrastructural development in tea-growing regions across the country.
The regulations provide a legal framework for the imposition, collection, and utilization of tea levy funds to improve roads, tea collection centres, and other structures critical to tea production and transportation.
Speaking during a media sensitization meeting on the implementation of the tea regulations, TBK Chief Executive Officer Willy Mutai said they remain committed to reforms and policies that will strengthen the competitiveness, sustainability, and profitability of Kenyan tea globally.
“The levy will contribute towards improvement of tea growing areas roads, tea collection centres and other infrastructure that directly supports tea production, transportation and market access,” said Mutai.
According to TBK, the funds will also help address logistical challenges affecting tea farmers and factories in producing regions.
Mutai noted that the tea sector remains one of Kenya’s most strategic value chains, supporting millions of livelihoods and contributing significantly to foreign exchange earnings and rural economic development.
He said the reforms are designed to promote fairness, accountability, and proper management across the tea value chain while reinforcing Kenya’s position as a leading global tea producer and exporter.
The CEO emphasized the need for accurate and balanced media reporting to help stakeholders understand policy changes and their intended benefits.
“The successful implementation of these reforms requires public understanding and confidence from investors and tea industry players. This is why the role of journalists and editors is extremely important,” he said.
On the levy structure, Mutai revealed that the initial proposal of a one percent tea levy was reduced to 0.8 percent following consultations with stakeholders.
“We are now discussing how the collected funds will be apportioned, especially the 50 percent that will go towards the Income Stabilization Fund as required by law,” he explained.
He added that the levy will directly benefit tea farmers, with buyers of Kenyan tea contributing to the fund, creating a sustainable financial support system for the industry.
“This is money that was not coming into the tea industry before. It is a major boost for farmers because they will now have a dedicated fund for their benefit,” said Mutai.
Mutai said TBK is also working to expand export destinations for Kenyan tea, noting that Kenya increased its tea export markets from 96 to 100 countries last year despite global geopolitical challenges.
Addressing concerns that the 0.8 percent levy could reduce Kenya’s competitiveness, he said the government has introduced several tax incentives to cushion the sector.
These include the removal of 16 percent VAT on tea packaging materials, value addition, and factory door sales to encourage local packaging and export growth.
Mutai said the reforms have already attracted multinational firms interested in establishing tea packaging operations in Kenya.
He further encouraged investors to take advantage of Export Processing Zones (EPZs) and Special Economic Zones (SEZs), which offer tax incentives of up to 15 years.
The board is also pushing for zero tariffs on Kenyan tea exports to China as part of efforts to expand international markets.
Kenyan tea remains among the best globally and continues to play a vital role in the country’s economy.
“Kenya tea remains one of the best in the world. Through strong partnerships, sound regulation, and informed communication, we can collectively safeguard and grow this important national asset,” said Mutai.
The tea subsector is a key contributor to the realization of Vision 2030 and the Bottom-Up Economic Transformation Agenda (BETA).
It supports over 800,000 farmers, contributes two percent of Kenya’s GDP and four percent of agricultural GDP, and remains the country’s second-leading foreign-exchange earner.
Kenya is the world’s third-largest tea producer and the leading exporter of Black CTC tea, accounting for 24 percent of global tea exports. The sector earned the country Sh181.91 billion last year, with a total marketed value of Sh218.79 billion.
by Wangari Ndirangu
