Consumers of wines and spirits have been hit with higher taxes as the 2022 Finance Bill sails through the floor of the National Assembly.
Members of Parliament adopted the Finance Bill late into the night on Thursday even as the House lacked a quorum which will require the House to take a final vote on the bill in the next sitting to rubber stamp the changes to taxation as a matter of protocol.
Despite proposing to hold further excise duty increases on alcoholic beverages, wines and spirits have been hit with higher duty in amendments of the Finance Bill by the Committee of the Whole House.
At the same time however, Kenyans can breathe a sigh of relief as Members of Parliament reject the introduction of VAT for the supply of maize and wheat flour while further cutting VAT on liquefied petroleum gas to eight per cent from the current 16 per cent.
Winners on the night
Gains from the trading of derivatives through the Nairobi Securities Exchange (NSE) to be exempted from income tax.
Digital Services Tax (DST) retained at 1.5 per cent
The supply of fertilizers zero rated
VAT on LPG falls to eight per cent from 16%
The rate of excise duty on powdered beer (Keg) retained at Ksh.121.85 per litre.
The supply of maize, cassava, wheat and meslin flour is retained under the exempt and zero rated category which means the commodities will not attract VAT (at the rate of 16 per cent).
Excise duty on bottled water, non-alcoholic beverages retained at Ksh.6.03 per litre.
Losers
Capital gains tax (CGT) moves from five per cent to 15 per cent.
Inflation adjustments to the rate of excise duty to remain as an annual review from the proposed bi-annual edit.
Beer whose alcohol content exceeds six per cent to attract excise duty at the rate of Ksh.134 per litre from Ksh.121.85.
Wines to attract duty at the rate of Ksh.229 per litre from the current Ksh.208.20.
Spirits exceeding six per cent in alcoholic strength to attract excise duty at Ksh.335.30 from the previous Ksh.278.70.
Tobacco substitutes including non-combustible tobacco to attract excise duty at Ksh.3750 from Ksh.1500 currently.
Excise duty on fees charged on advertisements by television stations, print media, billboard and FM stations on alcoholic beverages, betting and gaming set at 20 per cent.
Imported eggs for hatching removed from the import duty list.
The changes are set to be submitted as part of the Finance Bill which will be presented to President Uhuru Kenyatta for accent forming part of the 2022 Finance Act.
