- They also announced that plans for the payment of farmers' arrears and employees' salary arrears will also be unveiled within three months.
- Cabinet agreed that requests for proposals for the leasing of the five State-owned sugar mills will be published in a fortnight.
Image: PCS
The Cabinet on Monday approved a Sh117 billion write-off of public sugar mill debts in bank loans, tax arrears and penalties, farmers' and employees' dues.
In a Cabinet dispatch, President William Ruto acknowledged the bicameral Parliament resolutions on the reforms sanctioned by the Cabinet for the turnaround of the sugar sector.
"The sugar companies owe a whopping Sh117 billion in bank loans, tax arrears and penalties, farmers and employees' dues. They owe banks Sh65 billion, Sh50 billion in taxes and nearly Sh2 billion in farmers' dues," the dispatch read.
According to the Cabinet, the National Treasury is working on waiving tax penalties and interest within 30 days.
They also announced that plans for the payment of farmers' arrears and employees' salary arrears will also be unveiled within three months.
The Cabinet agreed that requests for proposals for the leasing of the five State-owned sugar mills would be published in a fortnight.
This comes after the National Treasury sought Parliament's approval to write off Sh117 billion in loans and tax penalties owed by five sugar millers in the country.
In a memorandum submitted to Parliament on August 22, 2023, Cabinet Secretary Njuguna Ndung'u told lawmakers the waiver is part of the Treasury's action plan to revive Chemelil, Muhoroni, Miwani, Nzoia and Sony sugar companies.
"That the total of Sh65,778,448,646 owed to the government of Kenya and Kenya Sugar Board as of June 30, 2023, by the five sugar companies be written off," Ndung'u stated in the memorandum.
Ndung'u wanted MPs to approve the write-off of tax penalties amounting to Sh50,144,801,608 as of June 30, 2023.
The CS also wants Parliament to approve payment of more than Sh1.7 billion owed to farmers by the sugar millers
"A payment plan for balances owed to farmers amounting to Sh1.715,129,404 be worked out by the Ministry of Agriculture and Livestock Development and the National Treasury," he said.
This is even as the President has maintained that he will sort out the mess ailing the sugar sector.
He insisted that he will decisively deal with the cartels which he said have for decades frustrated sugar farmers in the country.
"Sugar is critical and I will sort out the problems in our sugar factories for good," the President said.