The Tax Laws Amendment Act 2024 was signed into law by the President on December 11, 2024, and took effect 14 days later, on December 27, 2024. Among its significant provisions were adjustments to Excise Duty rates on excisable goods and services. These changes are especially important for taxpayers, particularly manufacturers, importers, and suppliers of excisable goods.
Notably, most of the adjustments have seen Excise Duty rates increase, which will likely raise the cost of goods and services. Below is an overview of the adjusted rates:
| Description | Old Excise Duty Rate (Prior to 27/12/2024) | New Excise Duty Rate (from 27/12/2024) |
|---|---|---|
| Imported sugar (excluding sugar imported by registered pharmaceutical manufacturers and raw sugar imported for processing by licensed sugar refineries) | Kshs. 5 per kg | Kshs. 7.50 per kg |
| Cigarettes with filters (hinge lid and soft cap) | Kshs. 4,067.03 per mille | Kshs. 4,100 per mille |
| Cigarettes without filters (plain cigarettes) | Kshs. 2,926.41 per mille | Kshs. 4,100 per mille |
| Products containing nicotine or nicotine substitutes intended for inhalation without combustion or oral application (excluding approved medicinal products) | Kshs. 1,594.50 per kg | Kshs. 2,000 per kg |
| Liquid nicotine for electronic cigarettes | Kshs. 70 per millilitre | Kshs. 100 per millilitre |
| Imported sugar confectionery | Kshs. 42.91 per kg | Kshs. 85.82 per kg |
| Wines, including fortified wines, and other alcoholic beverages obtained by fermentation of fruits | Kshs. 243.43 per litre | Kshs. 22.50 per centilitre of pure alcohol |
| Beer, cider, perry, mead, opaque beer, and mixtures of fermented beverages with non-alcoholic beverages and spirituous beverages (alcoholic strength not exceeding 6%) | Kshs. 142.44 per litre | Kshs. 22.50 per centilitre of pure alcohol |
| Beer, cider, perry, mead, opaque beer, and mixtures of fermented beverages manufactured by licensed small independent brewers | Kshs. 142.44 per litre | Kshs. 10 per centilitre of pure alcohol |
| Spirits of undenatured ethyl alcohol; spirits, liqueurs, and other spirituous beverages (alcoholic strength exceeding 6%) | Kshs. 356.42 per litre | Kshs. 10 per centilitre of pure alcohol |
| Imported self-adhesive plates, sheets, film, foil, tape, strip, and other flat shapes of plastics (excluding those originating from the East African Community) | 25% | 25% or Kshs. 200 per kg, whichever is higher |
| Imported plates of plastic (excluding those originating from the East African Community) | 25% | 25% or Kshs. 200 per kg, whichever is higher |
| Amount wagered or staked on betting and gaming (excluding horse racing) | 12.5% | 15% |
| Amount paid or charged to participate in a prize competition or buy a lottery ticket (excluding charitable lotteries) | 12.5% | 15% |
Remission Dates for Excise Duty
The Act also revised the timelines for remitting Excise Duty:
- Betting and gaming services: Excise Duty must be remitted within 24 hours from the closure of transactions of the day.
- Licensed manufacturers of alcoholic beverages: Excise Duty must be remitted on or before the fifth day of the following month.
- Other licensed persons: Excise Duty must be remitted on or before the 20th day of the month following the month in which the tax was collected.
Conclusion
These changes in Excise Duty rates under the Tax Laws Amendment Act 2024 are poised to impact various industries and consumers significantly. Manufacturers, importers, and suppliers of excisable goods need to take note of these adjustments to ensure compliance and adapt to the increased costs. As these rates come into effect, businesses and individuals must stay informed and adjust their operations accordingly.
