Consumers Set to Pay 1.50 Shillings More for Excisable Goods

In the year 2015, the government imposed an Exercise Duty tax on some goods including water that took effect starting December. Kenyans were to pay more for such goods as water, juice and beer, a move that drove the prices of some major commodities up. Even before the dust settles in the Kenyans pockets, manufacturers have announced that consumers will have to pay an extra 1.50 shillings as an excise duty stamp fee as well as for other costs that will be incurred during the installation of the newly adopted sin tax system.

During the month of February 2016, Kenya Revenue Authority introduced the new sin tax stamp that it said will help reduce on the amount of illegal goods coming into the country as well as help in getting those who evade paying tax. The is greatly going to impact on manufacturers of beer, processors of juice, softer drink manufacturers as well as water bottling companies. The manufacturers of these goods have protested the move and now the cost will have to be transferred to the consumer. Manufacturers have now said that there is going to be a price inflation if the Kenya Revenue Authority is not going to drop the implementation of the stamp.

According to the manufacturers, they will have to spend up to 100 million shillings as a way of changing the lines in which they manufacture their products so as to accommodate the new stamp. Last month, Kenya Revenue Authority contracted SICPA, a company from Swiss to implement and rollout the functioning of the excise of the stamp duty across a total of 64 companies in Kenya. What has attracted interest is however the fact that SICPA was named in a much publicized BAT scandal and many are doubting its legibility.

Kenyans are watching and waiting and the war of the titans; KRA and the Manufactures rages on see if the grass will suffer.

Article by Juma Fred.