KRA Announces Introduction of New Taxes on Construction Materials & Social Media Advertisements

The Kenya Revenue Authority (KRA) has announced the introduction of new excise duties on a range of goods and services, effective from December 27, 2024.

This announcement came through a public notice following the enactment of the Tax Laws (Amendment) Act, 2024, which aims to expand the taxation base and ensure fair contributions from various sectors.

“The Kenya Revenue Authority (KRA) notifies all manufacturers, importers, and suppliers of excisable goods and services that the Tax Laws (Amendment) Act, 2024 has introduced Excise Duty on the following specified goods and services effective from 27th December 2024,” the statement read.

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Details of the New Excise Duties by KRA:

• Electrical Transformers: Imported fully assembled electric transformers and their parts will now be subject to a 25% excise duty. This affects several tariff headings from 8504.10.00 to 8504.34.00.
• Printing Ink: Imported printing ink, excluding those from East African Community (EAC) partner states, will be taxed at 15%. This applies to tariff headings 3215.11.00 and 3215.19.00.
• Ceramic Products: A variety of ceramic products like sinks, wash basins, and tiles, under tariff heading 6910 and 6907, will attract a duty of 5% of their custom value or a specific rate per unit, whichever is higher. For instance, ceramic sinks will be taxed at 5% or Ksh 50 per kg, while ceramic tiles will be charged at 5% or Ksh200 per square meter.
• Glass: Imported float glass, whether reflective or not, under tariff heading 7007, will be subject to a 35% duty or Ksh200 per kg, whichever is higher.
• Coal: Coal imports will now carry a 2.5% duty based on custom value.
• Plastics and Paper: Various imported polymers and printed paper products will see a 20% to 25% duty, with some specific rates like Ksh150 per kg for printed paper or paperboard.
• Online Advertising: In a fresh twist, fees charged for advertisements on the internet and social media, particularly related to alcohol, betting, gaming, lotteries, and prize competitions, will be taxed at 15%.

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According to KRA, manufacturers and importers of the above excisable goods and services must apply for an excise license, import certificate and/or certificate of registration. Applications should be submitted to the tax service office.

Further, excise duty on excisable goods and services must be charged from December 27, 2024, and remitted by the 20th of the following month. The first return and payment for excise manufactured products is due on or before January 20, 2025.

At the same time, KRA has announced adjustment of excise duty dates for excisable goods and services.

Below are some of the affected goods and services.

Key Changes: 

1. Imported Sugar (excluding sugar imported by registered pharmaceutical manufacturers and raw sugar for processing by licensed sugar refineries):
   • Old Rate: Ksh4.607 per kg
   • New Rate: Ksh7.50 per kg
2. Cigarette with filters (hinge lid and softcap):
   • Old Rate: Ksh4,067.03 per mille
   • New Rate: Ksh4,100 per mille
3. Cigarettes without filters (plain cigarettes):
   • Old Rate: Kshs. 2,926.41 per mille
   • New Rate: Kshs. 3,100 per mille
4. Products containing nicotine or nicotine substitutes intended for inhalation without combustion or oral application but excluding medicinal products approved by the Cabinet Secretary responsible for health matters: 
   • Old Rate: Ksh5,154.50 per kg
   • New Rate: Ksh7,000 per kg
5. Electronic cigarettes and electronic cigarettes liquids:
   • Old Rate: Ksh70 per millilitre
   • New Rate: Ksh100 per millilitre
6. Imported sugar confectionery of tariff heading 17.04:
   • Old Rate: Ksh42.91 per kg
   • New Rate: Ksh65.82 per kg
7. Wines including fortified wines, and other alcoholic beverages obtained by fermentation of fruits:
   • Old Rate: Ksh243.43 per litre of pure alcohol
   • New Rate: Ksh22.50 per centilitre of pure alcohol
8. Beer, Oider, Perry, Mead, Opaque beer and mixtures of fermented beverages with non-alcoholic beverages:
   • Old Rate: Ksh142.44 per litre of pure alcohol
   • New Rate: Ksh15% of the ex-factory price

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