Kenyans should get ready for tough times
ahead in terms of digging deeper into their
pockets to pay significantly higher prices for
everything from beer, cigarettes, used cars,
juices to the naturally available water as
soon as the new excise rates passed by parliament come into effect. Even
worse for the consumer is that the bill comes
with a provision for a built-in annual
increase in tax rates that will keep immense
pressure on the consumer. Kenyans will now have to pay at least
300,000 shillings on second hand cars when
the excise duty will become fully operational. According to the bill, the excise duty levy on
all imported second hand vehicles that are
more than three years old is 200,000
shillings from the current rate of 20 percent
of the car’s price. When the excise duty becomes fully
operational, a Toyota Vitz for instance which
is eight years old and been attracting a duty
levy of 152,000 shillings will now a duty
levy of 300,000 shillings including the 16
percent Value Added Tax (VAT) plus the import duty. Beer manufacturers as well as cigarette
makers will now have to pay what is
known as the “Sin Tax”. Beer producers will now be taxed a total of
one hundred shillings (Ksh. 100) for every
liter of beer they produce. Cigarette makers will now have to pay two
thousand five hundred shillings (Ksh. 2,500)
for every one thousand (1000) sticks they
will be producing. Lovers of both fruit as well as vegetable
juices will have to brace for higher
payments once the new excise duty takes
effect because producers will now have to
pay a tax of ten shillings (Ksh. 10) per every
liter. Those thinking to venture into the
motorcycling business (bodaboda business)
must be ready to pay an extra ten thousand
shillings (Ksh. 10,000) per unit. The government, through the imposition of
these new excise duty levies hopes to raise
an additional twenty five billion shillings
(Ksh. 25 billions) from the items as one of the
factor to ensure that the 2.1 trillion budget is
funded. What are some of the effects that will
accompany these new rates? The first fact is
all these rates are transferred all the way to
the consumer on the ground. The consumer
in the streets is the one who will carry the
cross of ensuring that he or she pays as stipulated hence prophesying hard economic
times for most people who depend on the
commodities affected. The high rates imposed on beer for instance
will affect the value chain and the
agricultural sector will actually be affected
because companies will now be making less
bear, demand for beer will reduce and
employees will eventually lose employment and the saddest reality is that foreign
companies looking to invest in the beer
industry will keep off Kenya. Bodaboda transport will be expensive as the
operators will have to hike their fares as a
way of raising whatever they would have
spent and the reality at the moment is that
dealers in second hand cars are now
canceling orders and one wonders where the government will collect the said duty
from.
so far beer in those fancy lounges ni 250 on weekends na 200 on weekdays… if they raise it any higher narudia keg
Surprisingly, excise goods will still trade as normal
What happens when the intended consumers of the over taxed goods boycott the same? How can you tax your way to prosperity?
Beer companies will now be making less beer? In Kenya? Kuwa serious boss…
Pombe lazima tunywe, I was still drinking when we swore ikifika 100 hatutakunywa tena. Am still at it ikiwa over 150.
Kitu inaudhi ni kuwa the targeted 25 billion is a small part of the 2 trillion budget but will mess up the economy much. Even the missing billions are 67 and bado tunaendelea. In the grand scheme of things this tax bill will leave Kenya in a worse position.
UHURUTO FISTING CITIZENS BILA LUBE BILA HURUMA!