Kenyans should brace themselves for an increase in prices of some commodities including bottled water, juices, soda and other non-alcoholic beverages and cosmetics sector, to accommodate Excise Tax, as the new, Go Live date for the Excisable Goods Management System (EGMS) is set for next month.
Kenya Revenue Authority has informed all licensed manufacturers, importers, distributors retailers, and the general public that further to the public notice dated 30th August 2019 bottled water, juices, energy drinks, soda and other non-alcoholic beverages manufactured in or imported into Kenya from 13/11/2019 must be affixed with an Excise Stamp in accordance with Section 28 of Excise Duty Act 2015.
“Only licensed manufacturers and licensed importers of Excisable goods in accordance with the Excise Duty Act 2015 can obtain exercise stamps. All bottled water, juices, energy drinks, soda and other non-alcoholic beverages manufactured and imported into Kenya prior to the go-live date will be allowed to market without stamps until 31st January 2020.
“Any products manufactured or imported on or after 13 November without bearing the stamp or those before 13th November found in the market after 31 January 2020, not bearing the excise stamp shall be seized and offenders prosecuted. To Purchase the excise stamps, manufacturers can visit https://egms.kra.co.ke using log in details issued after licensing,” read part of the statement.
The costs attached to the EGMS are high for all manufacturers and untenable for small industries. Stakeholders say this will impact negatively on the competitiveness of the industry as manufacturers do not have any control on possible increment on the excise stamp duty in future, as experienced by some sectors such as tobacco manufacturers.
Although the EGMS seeks to do away with illicit trade and authenticate excisable goods, the implementation of the System will have a negative impact on the industry by increasing operating costs and capital expenditures thereby significantly increasing the cost of doing business, which will end up raising the cost of living for Kenyans.