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{
    "id": 193528,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/193528/?format=api",
    "text_counter": 110,
    "type": "speech",
    "speaker_name": "Mr. Kimunya",
    "speaker_title": "The Minister for Finance",
    "speaker": {
        "id": 174,
        "legal_name": "Amos Muhinga Kimunya",
        "slug": "amos-kimunya"
    },
    "content": "Mr. Speaker, Sir, hon. Members will recall that last year I increased the excise tax payable on malt beer by only Kshs2 per litre from Kshs48 to Kshs50 on equivalent of Kshs1 per bottle. Now, following this insignificant adjustment, the industry immediately advertised a price adjustment of Kshs5 per bottle which translated to a net gain to the industry of Kshs4 per bottle. Now, to recoup part of this gain that went to the industry, and to finance the priority programmes in this Budget, I propose that we split that Kshs4 gain by increasing the excise tax on malt beer by a modest amount of Kshs4 per bottle which will bring the rate on these beers in line with the rates currently applicable on the stouts. Further, Mr. Speaker, Sir, to ensure equity in the beer taxation and to avoid the down- trading as people move from malt beer to the non-malt beer because it has a lower tax, I propose to increase, as a first step, the Excise Tax rate on the non-malt beer by Kshs10 per litre from the current Kshs26 to Kshs36 per litre, which is Kshs5 per half-litre bottle. However, to mitigate the effects of reduced supplies of locally produced barley, I am also in consultation with my colleagues in the East Africa Community, proposing to reduce the duty rates applicable to imported barley which is necessary to produce that beer, so that wananchi can enjoy and contribute to the tax kitty. I expect the Excise Tax on this two measures to generate an additional Kshs1.1 billion to the Exchequer. In line with the international best practice and to ensure there is simplicity and equity in the Excise taxation of portable spirits and wines, I propose to introduce a regime that is based on alcohol strength by volume popularly referred to as ABV. That regime translates the current rates applicable on portable wines and spirits to Kshs7 per 1 per cent of alcohol. For instance, if a bottle of whisky is currently labelled 40 per cent of alcohol and it is one litre, the tax payable on it has been Kshs280. It will remain at Kshs280 because it is Kshs7 X 40 X one litre. I think that will now make it simpler for the different alcohol strengths to be assessed by the Excise Department. These measures will take effect from midnight tonight! I am not through yet with the national development. The tough times that our country is facing, and what we have gone through, calls for extra sacrifice by all Kenyans of good will. While I must salute the majority of our citizens who, in spite of their meagre resources, continue to support the country by paying their fair share of taxes, we, as leaders, need to go an extra mile to demonstrate leadership by example."
}