Blow to Tobacco traders, manufacturers as Senate panel endorses ‘punitive’ Bill

Tobacco traders and manufacturers have suffered a setback after a Senate committee approved a controversial Bill imposing heavy taxes and strict regulations on the production, sale and use of tobacco and related products.

 The Senate Health Committee has cleared the Tobacco Control (Amendment) Bill, 2024, for processing by the Senate—dealing a blow to stakeholders who have been lobbying for its rejection, terming it “punitive.”

 While the committee, chaired by Uasin Gishu Senator Jackson Mandago, proposed minor changes, it left intact most of the contentious provisions.

 “Having considered the Tobacco Control (Amendment) Bill, 2024, and the submissions received thereon, the Standing Committee on Health recommends that the Bill proceed to the next stage of the legislative process,” the committee said in a report tabled in the House.

 The Bill is currently in the second reading stage in the Senate.

 Sponsored by nominated Senator Catherine Mumma, the Bill seeks to tighten control over the production, sale, advertisement and consumption of nicotine products—both natural and synthetic.

 It also extends regulation to nicotine pouches and Electronic Nicotine Delivery Systems, popularly known as vapes.

 “This is necessitated by the current situation where products have been introduced into the market and distributed without authorisation or understanding of their public health impact,” Senator Mumma said.

 The committee retained the proposal for mandatory licensing for all individuals or entities engaged in the manufacture, distribution, storage, or sale of tobacco products.

 It further recommended that, in addition to national government taxes and levies, tobacco dealers pay additional county taxes, with all activities restricted to fixed, licensed premises—effectively banning the hawking of tobacco products.

 “While stakeholders have raised concerns about the single business permit aspiration, it is important that the tobacco products business be licensed at the county level for proper monitoring and compliance,” the report noted.

 The committee also upheld the proposed ban on advertising, online sales and hawking of tobacco products—provisions that manufacturers, including British American Tobacco (BAT), had strongly opposed.

 “Allowing such activities would make tobacco products easily accessible to youth and children,” the committee argued, adding that the bans should be retained as proposed by the sponsor.

 It also endorsed a complete ban on characterising flavours and additives—such as fruits, spices, herbs, menthol, alcohol and similar substances—saying these make the products more appealing and encourage abuse.

 On taxation, the committee proposed amending the Bill to give the Cabinet Secretary for the National Treasury greater discretion to determine how tobacco products are taxed.

 While the Bill initially required the CS to base taxes solely on nicotine concentration, the committee said this would limit the CS’s flexibility and weaken the deterrent intent of the law.

 “Limiting the Cabinet Secretary to taxation based only on nicotine levels may not achieve the Bill’s purpose of discouraging public use of harmful tobacco products,” the report said.

 “The committee proposes deleting these provisions to allow the CS wider discretion to tax based on other elements.”

 In addition, manufacturers will pay product testing fees and the ban on online and digital advertising across social media and video-sharing platforms will remain.

 In one key change, the committee recommended transferring the authority to test and approve tobacco products from the Cabinet Secretary for Health to the Kenya Bureau of Standards (KEBS).

 “Section 4 (1)(c) of the Standards Act empowers KEBS to examine and test commodities and materials, including their production and processing methods,” the report noted.

 Other proposed amendments by the committee are insignificant as they focus on the definition of various terms.

 The Bill has faced fierce resistance from business associations and traders.

 Last month, members of the Bar, Hotels and Liquor Traders Association of Kenya, the Retail Trade Association of Kenya and Business Focus protested outside Parliament, urging senators to reject the Bill.

 They argued that the proposed law threatens jobs and small businesses and was developed without adequate public participation.

 “Several provisions in the Bill will kill legal businesses and hand over the sector, particularly nicotine products, to criminal enterprises,” the associations said.

 In Mombasa, traders echoed similar sentiments, accusing the Senate of rushing the Bill.

 “This Bill will burden small traders and make tobacco products unaffordable for ordinary Kenyans,” said Faith Mwende, a business owner. “We were never properly consulted during public participation.”

 INSTANT ANALYSIS

 The pushback from tobacco manufacturers and traders underscores the tension between public health objectives and the survival of small businesses. While the Tobacco Control (Amendment) Bill, 2024, aims to curb rising nicotine use, its stringent provisions—ranging from licensing requirements to flavour bans and digital sales restrictions—are viewed by industry players as punitive and detrimental to livelihoods.