NAIROBI, Kenya, Jan 17 – Kenyans could soon pay more for alcohol, cigarettes, juice and cosmetic products as the Kenya Revenue Authority (KRA) seeks to increase the cost of excise duty stamps for the goods, as part of its measures to increase revenue collection.
KRA in a public notice published on Tuesday proposed to review The Excise Duty (Excisable Goods Management System) Regulations, 2017, through The Excise Duty (Excisable Goods Management System) (Amendment) Regulations, 2023 which contain the new costs for the duty stamps.
In the proposed regulations, the cost of excise stamp fees for cigars, cigarettes, liquid nicotine for electronic cigarettes and other manufactured tobacco and manufactured tobacco substitutes will increase to Sh5 per stamp from Sh2.80.
The cost of excise stamps for wines and other alcoholic beverages obtained by fermentation of fruits, and compounded spirits of alcoholic strength exceeding 6 per cent will also increase to Sh5 from Sh2.80.
For beer, cider, perry, mead, opaque beer, and mixtures of fermented beverages with non-alcoholic beverages, the cost of an excise stamp will increase from Sh1.50 to Sh3.
Traders of other non-alcoholic beverages, not including fruit and vegetable juices, fruit juices (including grape must), and vegetable juices, unfermented and not containing added spirit will now pay Sh2.20 per excise stamp from Sh0.60.
On cosmetic and beauty products, KRA seeks to increase the cost of an excise stamp from Sh0.60 to Sh2.50.
The taxman sought to maintain the cost of a stamp on bottled water at Sh0.50.
Public memoranda
KRA invited interested members of the public and stakeholders to submit their inputs and comments for consideration in the finalization of the regulations by February 3.
The taxman noted that the revenue from the excise stamp fees shall be retained by the Commissioner for the financing of the system and compliance management activities of the excise sector.
The adjustments, if approved, signal a higher cost of living for Kenyans as it will add on to the costs for manufacturers who will pass on the cost to consumers.
They come barely four months after KRA implemented an excise duty inflation adjustment.
The taxman raised taxes on a range of excisable goods like wine, beer, bottled water and juice by 6.3 percent from October in line with average price growth for the financial year ended June 2022.
The October review increased duty on a litre of beer by Sh8.44 to Sh142.44, wine (Sh14.43 to Sh243.43), spirits like whisky (Sh21.12 to Sh356.42), juices (Sh0.84 to Sh14.14) and bottled water (Sh0.38 to Sh6.41).
The amendments are part of the reforms by Treasury under the revenue administration of KRA to boost revenue collection.
President William Ruto’s administration is keen to grow revenues by about half to Sh3 trillion by the next financial year.
The latest Treasury data shows that total revenues by the end November 2022 amounted to Sh893.8 billion against a target of Sh912.9 billion, presenting a major task to KRA to close the gap.
