As part of its measures to increase revenue collection in the country, the government through the Kenya Revenue Authority (KRA) has proposed an increase in excise stamp fees on alcohol and cosmetic products.
Proposed change in prices of alcohol & major beauty products for 2023
Kenyan consumers are likely to feel the pinch when purchasing these items after the proposed review takes effect.
In a public notice published on Tuesday, KRA proposed to review the Excise Duty Regulations 2017, through the Excise Duty (Amendment) Regulations 2023, which contains new stamp fee costs.
This means that the already high cost of living will continue to rise even further in 2023.
1. Cigarettes, alcoholic & non-alcoholic beverages
Under the proposed amendment, the cost of excise stamps for cigars, cigarettes, liquid nicotine, and other manufactured tobacco substitutes will increase from Sh2.80 to Sh5.
A similar rise will apply to wines and other alcoholic beverages obtained by fermentation of fruits, as well as compounded spirits of alcoholic strengths exceeding 6% - from Sh2.80 to Sh5.
The stamp for beer, cider, perry, mead, opaque beer, and mixtures of fermented non-alcoholic beverages will increase from Sh1.50 to Sh3.
For other non-alcoholic beverages such as bottled water, the excise stamp will now cost Sh2.20 up from 60 cents.
2. Beauty products
In case the proposed plan sails through, consumers of cosmetic or beauty products may experience the largest price increase.
The cost of an Excise stamp on the products will increase to Sh2.50 up from Sh0.06.
The new administration says that its quest to raise additional revenues has not been fruitful due to the depressed collection of taxes and expenditure pressure from the consumers battling high inflation.
KRA collected tax revenues amounting to Sh952.65 Billion by the end of the second quarter to December 2022.
The proposals come barely four months after KRA implemented an excise duty inflation adjustment.
Public participation on proposed Excise Duty (Amendment) 2023
In October 2022, the taxman imposed a 6.3% tax increase on a range of excisable products such as wine, bottled water, and juice.
A liter of beer went up Sh8.44 to Sh142.44, while the price of wine increased by Sh14.43 shillings to cost Sh243.43.
Meanwhile, a bottle of whisky went up by Sh21.12 shillings to trade at Sh356.42, while juices and bottled water increased by 84 cents and 38 cents respectively to trade at Sh14.14 and Sh6.14 per litre respectively.
Interested members of the public and stakeholders have been invited to submit their views on the proposed changes before February 3, 2023.
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