MOGADISHU (HOL) – Somalia has doubled taxes levied on the leafy stimulant khat which is mainly imported from Kenya and Ethiopia in what is going to further put into distress exporters of the product from the two countries which are already reeling from suspension of business owing to COVID-19.
A meeting bringing together Finance Ministers from Federal Member States and Federal Government Tuesday resolved to increase taxes levied on the khat from $2.5 per kilogram to $4.
An order suspending imports of khat into Somalia is still in force despite the country lifting international flights ban.
Anti-khat lobbyists in Somalia have heightened their campaigns to persuade the government to ban import of khat. However, the commodity generates considerable revenues to the Federal Government.
According to the 2020 National Budget, the government estimates to generate $14 million from taxes on khat.
The meeting also resolved that the two levels of government and Banaadir Regional Administration should share equally World Bank aid in light of the impact of COVID-19 on the national budget.
A technical committee from both the FGS and FMS will work out a resource sharing formula, a communique from the meeting read in part.