Kenya: CSOs Advocate for Health Promotion Taxes
Civil Society Organizations (CSOs) of Kenya are advocating for the tax increases on tobacco and alcohol that was proposed by the Minister of Finance in the 2019 budget speech. The CSOs are defending these measures against lobbying attacks from the tobacco and alcohol industries and want to ensure that the public interest prevails.
The Kenyan Minister of Finance announced in the budget speech a 15% tax hike on tobacco, wine and liquor. CSOs commend this move in an open letter to the President of Kenya, as it is in line with WHO best buy recommendations for
- a regular increase in excise rates, and
- annual adjustment for inflation to prevent erosion of the real value of the excise tax on harmful products.
Meanwhile, The Alcoholic Beverages Association of Kenya and tobacco manufacturers including British American Tobacco Kenya Ltd. are “strongly opposing” a decision by lawmakers to raise excise tax rate to 21% from the 15.85% proposed by National Treasury in the Finance Bill.
The industries are arguing higher taxes lead to tax evasion, smuggling and counterfeiting and are aggressively lobbying the government for a reduction in the proposed tax hike.
The broad coalition of CSOs have stated their concern about such flawed arguments in their joint open letter.
Taxes are NOT the singular cause of illicit trade in tobacco and alcohol. Other complementary measures, such as strengthening of tax administration and effective implementation of electronic goods management systems (EGMS) can be adopted to control any perceived or real concerns.
Fast- tracking of the Country’s ratification of the World Health Organization (WHO) Protocol to Eliminate Illicit Trade in Tobacco Products will particularly strengthen the country’s efforts to control illicit trade in tobacco products,” states the letter written by CSOs.
The joint letter was issued by the International Institute for Legislative Affairs (ILA), the Alcohol Control and Policy Network (ACPN) – a member organization of IOGT International, the Kenya Tobacco Control Alliance (KETCA) and the Non- Communicable Diseases Alliance of Kenya (NCDAK).
The CSOs call upon the president of Kenya to assent to the Finance Bill 2019 as is, to give force to the increment of excise tax on tobacco and alcohol and to protect the health and wellbeing of all Kenyans by doing so.