Cigarette manufacturers will share the cost of treating people sickened by tobacco. Health Cabinet Secretary Cleopa Mailu said manufacturers must contribute two per cent of their annual income to a central tobacco control fund.
“You are expected to pay at the end of every financial year a solatium compensation contribution, which shall be the sum of two per cent of the value of tobacco products manufactured or imported by the manufacturer or importer that financial year,” he said in a notice yesterday.
The directive is contained in the tobacco control regulations, which take effect on September 26. The CS said the levy will help offset the huge medical bills the government incurs in treating tobacco-related problems such as lung cancer.
The fund will be managed by the Tobacco Control Board. An estimated 2.5 million Kenyans smoke. More than half this number start the habit before they are 20. Manufacturers have all along opposed the levy, saying they are already exposed to other taxes and they paid Sh14 billion tax in the last financial year.
“The solatium contribution will have a significant effect on the petitioner, putting at risk further investment and the more than 80,000 direct and indirect employment opportunities generated in Kenya,” Britich American Tobacco told the High Court when it sought to block the rules. It lost the case.
The company, whose net revenue last year was Sh22.3 billion, would have paid Sh400 million to the fund.The ministry also published 15 disturbing images that must appear on cigarette packets by September 26. The aim is to deter smokers.
It will now be illegal for traders to sell cigarettes whose packets do not have any of the images, the ministry said. They include photos of dead babies, throat gnawed by cancerous tumours and rotten teeth. Others are images of shisha equipment, electronic cigarettes, coffins and cancerous lungs.