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You’ll pay more for beer as KRA sets new taxes

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The prices of beer, bottled water and juice, are set to rise from this month after the Kenya Revenue Authority (KRA) moved to effect annual inflation tax adjustment on excise duty charged on the products.

The taxman indicated excise duty on the products will increase 4.97 per cent effective November 2 in line with average annual inflation. Pricewaterhouse Coopers (PwC) had on Tuesday warned of possible confusion over the effective date of the legal notice.

The increase will see manufacturers pass on the additional cost of the commodities to end-users in which may further stoke public outrage over the high cost of living.

 “KRA would like to inform manufacturers and importers of excisable goods and the public that the rates of excise duty on excisable goods that have a specific rate of duty have been adjusted using the average inflation rate for the 2020/2021 financial year of 4.97 per cent as required under the section 10 of the Excise duty Act 2015,” said the KRA in a notice on Tuesday.

“The adjusted rates are provided under legal notice Number 217 of 2021 and are effective from November 2.”

The adjustment is in line with the law that demands that excise duty be revised upwards in tandem with the cost of living measure or the average rate of inflation in the 12 months through June.

Industry lobby Kenya Association of Manufacturers (KAM) had consistently urged the taxman to pause implementation of the annual inflation adjustment tax that affects excisable goods, citing economic hardships as a result of the Covid-19 crisis.

Last year, the taxman increased the costs of the products by at least 5.43 per cent, a blow to consumers hurt by job cuts and unpaid leave in the wake of the Covid-19 pandemic.

The post You’ll pay more for beer as KRA sets new taxes appeared first on CmaTrends.

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