National Treasury Cabinet Secretary Henry Rotich has set Dec. 1 as the commencement date for the Excise Duty Act, which was controversially passed in the National Assembly on Oct. 28.
Rotich has said the government plans to net extra cash through the law to support projects, some of which have slowed due to less revenue collections.
Kenya, which has introduced austerity measures to help cut unnecessary expenditure, hopes implementation of the new law will help it raise 285 million dollars to bridge the budget deficit which has been rising.
Some of the items whose prices are expected to increase include low-end cigarettes and second-hand car imports, juice, bottled water and motorcycle.
Effectively, tax on bottled water, fruit juices containing sugar or sweeteners, soft drinks and vegetable juices will go up to 0.1 U.S. dollars from 0.03 dollars per litre. The excise duty on food supplements has also been fixed at 10 percent.
Tax on cigarettes rises to 2.5 dollars per mille (1,000 sticks) from the present 1.2 dollars per mille or 35 per cent of the retail sales price.
Importers of second-hand cars will now pay 2,000 dollars excise tax per unit aged more than three years, and 1,500 dollars for that less than three years old. This is a break from the present 20 percent excise duty. Enditem