“National Treasury Asked to Raise Taxes on Tobacco, Sugary Drinks and Alcohol”
The Standard reports:
“The International Institute for Legislative Affairs (IILA) has submitted a proposal to Kenya’s Treasury for the Finance Bill 2026, calling for increased excise tax on alcohol, including a rise in beer tax from Sh22.50 to Sh33 per centilitre of pure alcohol. The proposal aligns with the WHO Global Alcohol Action Plan and the East African Community’s minimum rate of USD 6 per litre of pure alcohol.
“IILA CEO Celine Awuor noted: ‘Following the repeal of the inflation adjustment provision in the Excise Duty Act via Finance Act 2023, excise taxes on tobacco, sugary drinks and alcoholic beverages are not adjusted to inflation, hence the value of the excise tax and revenue price of tobacco is eroded, making the products affordable over time. This is dangerous as it erodes the efforts and essence of these taxes as a public health measure.’”
Other Articles on Same Topic
- Treasury CS John Mbadi pledges zero new taxes in Finance Bill 2026, citing the 2024 budget crisis: “The nation nearly exploded in 2024 due to the perceptions that we were raising taxes” (Tuko News)
Assessment
IILA’s proposal calls for ambitious, evidence-based alcohol taxation aligned with WHO guidance – the kind of policy that prevents and reduces alcohol harm and that the public supports: 65% of Kenyans back higher alcohol taxes, rising to 86% when revenue is earmarked for education. But it faces a government unwilling to raise any taxes.
The 2024 Finance Bill triggered mass protests and a storming of parliament – driven by tax proposals on everyday goods, a deepening debt crisis, and public anger over government spending and corruption. The government has since pledged to avoid all new taxes, but in doing so it treats pro-health taxation as politically equivalent to the levies that sparked the unrest. Treasury CS Mbadi’s assurance that “we are not looking at a possibility of increasing tax rates” effectively shields the alcohol industry from needed reform.
The repeal of automatic inflation adjustment in 2023 compounds the problem. Kenya’s alcohol taxes are becoming progressively less valuable in real terms each year – a silent but steady erosion of their protective function. As general prices rise and tax rates remain static, alcohol becomes increasingly affordable.
Previous reporting has documented the alcohol industry’s efforts to hijack Kenya’s excise tax debate, and the World Bank has advised Kenya to raise alcohol taxes precisely as a coherent fiscal and health strategy. The government’s political calculus – fearing public reaction – inadvertently serves industry interests whilst foregoing revenue that could finance critical health and social spending, while reducing alcohol harm. For alcohol policy advocates, the task is to decouple pro-health taxation from the broader “no new taxes” narrative and build parliamentary support for the evidence-based case that targeted alcohol taxes serve both fiscal sustainability and public health.