The price of bottled water is expected to increase by an average Ksh.7 per litre with effect from next week Wednesday as the Kenya Revenue Authority (KRA) moves to implement new excise taxes on water companies.
Speaking on Thursday, members of the Water Bottlers Association of Kenya (WBAK) said they have no choice but to pass on the additional costs which incorporate Value Added Tax (VAT) to consumers.
The Association has criticized the implementation of the new taxes which require bottled water manufacturers to install new generation excise stamps on bottled water, cosmetics, juices, soda and other non-alcoholic beverages under the Excisable Goods Management System (EGMS)
“The water that people use on a daily basis is going to be unaffordable. This means that under the economic hardships, people may choose to turn their contained spend away to more crucial goods,” WBAK Chairman Henry Kabogo said.
“Currently the excise stamp costs Ksh. 1.50. This will greatly increase the cost of production for manufacturers and for consumers as well,” noted the Kenya Association of Manufacturers (KAM) in an earlier statement.The new proposed excise rate of Ksh.5 replaced the old charge of Ksh.3 or an equivalent five/seven percent of total product’s cost.
KRA will allow the sale of already circulating products without the stamp to the end of January next year.