globaltaxnews.ey.comSign up for tax alert emailsPrintDownload

19 March 2018

Kenya's High Court ruling stops placement of excise stamps on certain goods

On 12 March 2018, Kenya's High Court nullified the Excise Duty (Excisable Goods Management System) Regulations, 2017 issued under Legal Notice No. 53 of 2017 (EGMS Regulation). The case was brought by Mr. Okiya Omtata Okoiti (the Petitioner) against the Kenya Revenue Authority (KRA), the National Treasury and SICPA Security Solutions SA (collectively, The Respondents).

The regulations required manufacturers and importers of bottled water, juices, soda, other non-alcoholic beverages and cosmetics to affix excise stamps on such goods. The Court's order was issued on the basis that the regulations were enacted without adequate public participation, in an unconstitutional manner and against the provisions of the Statutory Instruments Act.

Accordingly, manufacturers and importers of the designated goods are no longer required to affix excise stamps.

Next steps

It is likely the KRA will appeal the High Court decision to the Court of Appeals or alternatively proceed with stakeholder engagement and public participation within the drafting of EGMS regulations that conforms to the Statutory Instruments Act.

It is important to note that the following requirements still apply to manufacturers and importers of the aforementioned goods:

  • Filing of monthly excise duty returns in accordance with the law
  • Payment of excise duties and taxes at the current prevailing rates (set forth in the table below)

Category of excisable goods

Excise duty rates

Fruit juices (including grape must), and vegetable juices, unfermented and not containing added spirit, whether or not containing added sugar or other sweetening matter

KES10 per liter

Food supplements

10%

Cosmetics and Beauty products of tariff heading No. 3303, 3304, 3305 and 3307

10%

Waters "excluding water of tariff No. 2201.90.00" and other non-alcoholic beverages not including fruit or vegetable juices.

KES5 per liter

Based on the High Court's ruling, manufacturers and importers of the respective goods are not required to:

  • Register under the EGMS system
  • Affix excise stamps to the goods or maintain a monthly excise stamp register

———————————————
CONTACTS

For additional information with respect to this Alert, please contact the following:

Ernst & Young (Kenya), Nairobi

  • John Gikima
    john.gikima@ke.ey.com
  • Stephen Ndegwa
    stephen.ndegwa@ke.ey.com
  • Emmanuel Makheti
    emmanuel.makheti@ke.ey.com
  • Esther Muteti
    esther.muteti@ke.ey.com

Ernst & Young (Uganda), Kampala

  • Hadijah Nannyomo
    hadijah.nannyomo@ug.ey.com

Ernst & Young Advisory Services (Pty) Ltd., Africa ITS Leader, Johannesburg

  • Marius Leivestad
    marius.leivestad@za.ey.com

Ernst & Young LLP (United Kingdom), Pan African Tax Desk, London

  • Rendani Neluvhalani
    rendani.mabel.neluvhalani@uk.ey.com
  • Byron Thomas
    bthomas4@uk.ey.com

Ernst & Young LLP, Pan African Tax Desk, New York

  • Silke Mattern
    silke.mattern@ey.com
  • Dele A. Olaogun
    dele.olaogun@ey.com
  • Jacob Shipalane
    jacob.shipalane1@ey.com

Ernst & Young LLP, Pan African Tax Desk, Houston

  • Elvis Ngwa
    elvis.ngwa@ey.com

———————————————
ATTACHMENT

PDF version of this Tax Alert

Document ID: 2018-5427

 
 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 2025, Ernst & Young LLP.

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.

 

"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

 

Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.

 


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or ey.com. Please refer to the privacy notice/policy on these sites for more information.


Yes, I accept         Find out more