Treasury Introduces Tax on Sweets to Control Obesity

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Treasury Introduces Tax on Sweets to Control Obesity

A Ksh 20 excise duty for every kilogram of sugar confectionery proposed by President Kenyatta will see consumers pay more for candy. 

In a memo sent to the National Assembly, the president proposed the sweet tooth tax in a bid to raise revenue.

The confectionery excise duty would affect prices of sweets, candied nuts, chewing gum, and bubble gum.

The proposed tax shall affect lovers of confectionary

President Kenyatta has set his eyes on items that the everyday Kenyan uses to run a costly national and county government structure, fund his ambitious Big Four Agenda as well as repay mounting debt.

Treasury Cabinet Secretary Henry Rotich defended the addition saying it would reduce and save children from lifestyle diseases such diabetes as well as counter rising obesity levels.

“You’re complaining about this tax while the country is spending more on obesity. That was the rationale we used when we decided to control the problem through taxation while also increasing government’s revenue,” Rotich told the National Assembly Finance Committee.

Obesity has reached epidemic proportions globally, with at least 2.8 million people dying each year as a result of being overweight or obese, according to the World Health Organisation.

The country’s confectionery market has been growing, with 9 firms producing an estimated 55,4187 metric tonnes out of which 23,084 is exported.

The Cs added that failure to pass the tax proposals would adversely affect the revenues collected, “making it inconsistent with the approval fiscal framework and provisions of the Division of Revenue Act, 2018.”

CS Henry Rotich

Other tax recommendations include an 8pc VAT on petroleum products, motor vehicle duty of between 20 and 30 percent, an increase in duty on mobile and internet data services from 10pc to 15pc and also a 15 percent increase in duty on mobile and internet data services, up from 10 percent.

The Housing Development Fund tax, paid by both the employer and employee, has been increased by 1.5 percent of the monthly basic salary with employers fined 5 percent for failure to submit contributions.

 

 

 

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