Tea traders step up the fight against new laws

 

The East African Tea Trade Association (EATTA) has moved to court seeking suspension of more sections of the newly enacted Tea Act arguing that they are discriminatory and unconstitutional.

 The association, which manages the weekly tea auction in Mombasa says implementation of the law will destabilise production and export of the beverage in Kenya.

The High Court has already issued orders suspending sections, which barred direct tea sales and implementation of the tea levy, following a petition by 15 tea estates.

In the EATTA petition, the association says tea sector accounts for 22 percent of the country’s foreign exchange earnings, yet has been subjected to more taxes.

Among the sections targeted by the EATTA is 34(4), which it said is silent on the percentage of payments to be borne by tea buyers and factories to pay the brokerage commission.

The section caps brokerage fees but fails to indicate how the fees will be paid, EATTA argues.

The association wants the court to interpret and determine whether sections 5(l), 32(3)(b), 32(4), 34(3)(b), 34(4)(5)(6), 36(1),48 (1) and 53 of the Tea Act are constitutional.

The enactment of Section 53 of the Act on provision of tea levy, the association adds, shall be ultimately borne by the farmer or producer of tea.

“The provision is in utter contravention of the Constitution that provides for freedom from discrimination and equality before the law, which shows how the tea sector has been singled out and subjected to further taxes,” said lawyer Maureen Cheruiyot.

The association said it runs and conducts the weekly Mombasa Tea auction from 10 countries. Its interests include tea producers, buyers (exporters), brokers, packers, and warehousemen and tea producers in Kenya, Uganda, Tanzania, Burundi, Rwanda, DRC, Ethiopia, Madagascar and Malawi.

On Monday, the High Court temporarily suspended collection of tea levy and sections of the Tea Act, which compels processors and manufacturers of tea, save for orthodox and specialty, from direct sales.

The case will be heard on February 22.