As the Kenyan government seeks to fund its historic Ksh 2 trillion budget, it will make use of multiple tax policies, including increased alcohol taxes.
During the unveiling of the 2015/2016 Financial Year budget by Treasury Cabinet Secretary Henry Rotich, the Kenyatta-government announced its plans to help fund the budget with additional taxation measures. Among the measures are increased taxes on fuel, tobacco, plastic bags, and alcohol.
Rotich announced, for example, that the levy on fuel will enable the government to fund the Road Annuity Fund with plans to scale up the existing and proposed road networks in Kenya.
With regard to the alcohol tax, it was, however, not yet announced what the exact value of the tax would be. Rotich mentioned, though, that the new tax measure will help raise additional revenue of about Ksh 25 billion.
The tax increase on alcohol will have a dubbel-positive effect:
- Higher alcohol prices will lead to decreased alcohol consumption and thus a reduction of alcohol-related harm in Kenya.
- The increased government revenue will allow investments in health promotion and prevention as well as treatment and rehabilitation of problems caused by alcohol.