The Kenya Kwanza Parliamentary Group meeting has backed a proposal to tax manufacturers of alcoholic drinks with high alcohol content more.
The resolution was read out by Molo MP Kuria Kimani who chairs the National Assembly Committee on Finance and Planning that considered the Finance Bill, 2024.
The MP said the decision is in line with the government's tough stance against sale of alcohol in the country.
"To support the fight against alcohol brews in the country, we have proposed change in exercise duty, changing it from per volume to per alcohol content,'' Kuria said.
Speaking at State House after President William Ruto chaired a PG meeting, Kuria said the review was necessary to reign in on the proliferation of liquor with very high alcohol content.
"Therefore those alcoholic manufacturers who are producing alcohol of high alcoholic content will be required to pay high duty based on alcohol content, those who produce alcohol of less alcoholic content will now pay less,'' Kuria said.
The Bill will not be tabled in the House for debate and consideration before MPs take the vote.
This is a new method of calculating excise on beer, wine and spirits based on pure alcohol content also known as Alcohol By Volume (ABV), unlike the present method, which has a flat excise rate.
Under the proposed measures, the average rate will increase from Sh356.42 to Sh640 with 95 per cent of the spirits portfolio being affected.
Industry data shows most of the consumption (69%) happens at 40% ABV at 250ml (recommended retail price sub-Sh300).
This means that the price increase will hit the consumer category the hardest, with the least price increase for compliant players set to be Sh100 per 250ml for most popular ABV, which is 40 per cent.
