Bar owners worried about plans to increase excise duty on alcohol

By People Team
Tuesday, September 1st, 2020
Pubs, Entertainment and Restaurants Association Nairobi branch chair Frank Mbogo (right) and board member Robert King’ori address the press, yesterday. Photo/PD/Kenna Claude
In summary

George Kebaso and Clement Kamau

Bar owners yesterday expressed concern over a proposal to increase excise duty on alcohol and other beverages.  

Through Pubs and Entertainment and Restaurants Association (PERAK), the traders   raised displeasure over restrictions they allege have  led to job losses.

PERAK Nairobi branch chairman, Frank Mbogo said it was unfortunate National Treasury continues to treat the alcoholic beverage industry as the default option whenever there is a need to increase revenue collection.

He said: “Latest proposal has come from the Kenya Revenue Authority (KRA), which seeks to increase Excise Duty.

This is regardless of the crippling circumstances in which the industry has been operating.” 

KRA had in May, in the Finance Bill, 2020, recommended amendments to the Excise Duty Act to enable it increase tax on a number of alcoholic drinks and beverages.  

“PERAK is worried that even with the re-opening; the industry will not recover given the increase in prices that is likely to be the result of an increase in Excise Duty as proposed by the KRA,” he noted.

However, Mike Muthamia, PERAK board member, has urged the government to allow bars and restaurants to resume business to enable the sector recover after six “very bad months, during which we have lost, and continue to lose, billions of shillings.”

“Livelihoods have been lost as thousands of employees were rendered jobless.

Bars and restaurants constitute many of the small and medium enterprises that have suspended work, some of whom we are aware may never rise out of the ashes again,” he said. 

PERAK appealed to its members to comply with guidelines set by the ministry of Health and to pass on their proposals on self-regulation.

Elsewhere in Kiambu, stakeholders in the alcoholic beverages drinks sector have appealed to the county government to waive licenses and levies for them. 

According to county Liquor Welfare Group Chairman Richard Kagiri, move would help cushion them from the effects of the global Covid-19 pandemic.

Kagiri also welcomed directive by the President to have investors and relevant authorities come up with a return to business formula.

“We have always vouched for the setting up a stakeholder’s forum to put in place protocols for re-opening the sector.

We appreciate the fact that the government has finally arrived at the conclusion,” he said.

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