Markets & Finance

Excise duty changes signal relief for bottled water, fruit juices’ consumers

juice

Consumers have been spared a rise in cost of bottled water after Parliament halved the excise levy of Sh10 per litre imposed under the Excise Bill 2015 to Sh5. MPs also completely scrapped similar tax on fruit and vegetable juices. PHOTO | FILE

Consumers have been spared a rise in cost of bottled water after Parliament halved the excise levy of Sh10 per litre imposed under the Excise Bill 2015 to Sh5.

MPs also completely scrapped similar tax on fruit and vegetable juices.

The amendments were made during the third and final reading of the Bill on Thursday. The excise at Sh10 per litre on beverages and water would have hit consumers directly given the practice by manufacturers to pass on costs.

“We are proposing to remove the duty of Sh10 per litre on juice and water,” said Subukia MP Nelson Gaichuhie when introducing the amendments that were made by the committee on finance, trade and planning.

The Excise Bill 2015, which is now only awaiting the President’s signature to become law, had imposed the Sh10 levy on fruit juices containing sugar or sweeteners, bottled water, soft drinks, vegetable juices and other non-alcoholic beverages.

Food supplements will, however, still attract an excise levy at 10 per cent after MPs left the proposal untouched in the Bill.

On cigarettes, the Bill had proposed a blanket levy of Sh2,500 per mille (thousand) on all cigarettes containing tobacco or tobacco substitutes.

READ: Beer, cigarette taxes hidden in excise Bill raise uncertainty

After amendments, plain cigarettes, including those with an ex-factory selling price of up to Sh2,750 per mille, will be charged Sh900.