Kenya’s Butali Sugar urges cane suppliers to embrace electronic invoicing

KENYA – Kenya’s Butali Sugar has called upon its cane suppliers to transition to the electronic Tax Invoice Management System (eTIMS) as the company aligns with the Kenyan Revenue Authority’s (KRA) online tax invoicing requirements.  

This move comes as the KRA set a deadline for businesses to onboard onto eTIMS by March 31, a system aimed at enhancing transparency in business transactions for tax verification purposes. 

In a circular issued on Wednesday, Butali Sugar expressed its efforts to seek a simplified solution from the KRA, but the attempts failed, leading to the implementation of the eTIMS invoicing requirement.  

Effective April 1, 2024, each farmer supplying cane to the factory is mandated to issue an e-TIMS invoice for every delivery, without which the miller will be unable to process payments for the delivered cane. 

“We will not be able to process and pay you for cane deliveries unless you as out farmer provide us with a valid Electronic Tax Incoice,” read the company notice. 

The KRA’s directive, effective from January 1, 2024, stipulates that any business expenditure not supported by a valid electronic tax invoice will not be deductible for income tax purposes.  

“To facilitate business continuity and allow for sufficient time for taxpayers to make adjustments in their systems and business operations, KRA wishes to notify non-VAT registered taxpayers that onboarding to the Etims platform will be available up to 32 March 2024,” stated KRA. 

Butali Sugar disclosed ongoing discussions with the KRA to find a simplified resolution to the invoicing requirements.  

The company urged suppliers to be patient as they seek a lasting solution to the matter. The miller emphasized its appreciation for the continued support and partnership of its suppliers amidst the transition to eTIMS invoicing. 

The call for electronic invoicing by Butali Sugar coincides with efforts by the Ministry of Agriculture to address a potential sugar shortage in the country.  

Agriculture Cabinet Secretary Mithika Linturi is advocating for an extension of the duty-free sugar import waiver, which currently allows imports from outside the Common Market for Eastern and Southern Africa (Comesa). 

The current waiver, set to expire on April 6, prompted the proposal for a two-month extension to ensure the country’s sugar requirements are adequately met.  

With looming concerns over a surge in sugar prices upon the expiration of the import window, the extension aims to mitigate potential shortages and stabilize the local sugar market. 

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