Taxation for Companies & Partnerships
What is Excise Duty
Excise duty is a tax imposed on goods and services manufactured in Kenya or imported into Kenya and specified in the first schedule of the Excise Duty Act (2015).
How do you get an Excise license?
To obtain an Excise license you initiate the process on iTax by clicking on the registration tab after you log in. Then select other registration, and click on Excise license. Fill in the details and submit. The requirements to get the licenses for importers and manufacturers are listed on the KRA website.
When are Excise Returns filed?
Excise returns are filed by 20th day of the following month. Licensed manufacturers or suppliers of excisable services are required to submit excise returns on iTax.
What is the penalty for late filing?
Late payment penalty is 5% of the amount of tax payable under the return or Ksh. 10,000, whichever is the higher.
Does water attract excise duty?
Only bottled or similarly packaged waters attract excise duty.
Is Excise duty applicable to those in water refill business?
Yes. All persons in the business of bottling (including through refilling) or packaging water are required to obtain an excise license from KRA as a prerequisite for charging and remitting excise duty. They are also required to affix excise stamps on each bottle that has been refilled or packaged.
What is an excise stamp?
An excise stamp is a type of revenue stamp affixed to some excisable goods to indicate that the required excise has been paid by the manufacturer.
Legal Notice No. 30 of 2023 titled; The Excise Duty (Excisable Goods Management System) (Amendment) Regulations, 2023 has amended, among other provisions, the the price of excise stamps effective 31st March 2023. The revised prices are as shown below;
Revision of excise stamp fees
|
No. |
Category of Excisable Goods |
Fees in Ksh. |
|
1 |
Cigars, cheroots, cigarillos, containing tobacco or tobacco substitutes |
5 per stamp |
|
2 |
Cigarettes containing tobacco or tobacco substitutes |
5 per stamp |
|
3 |
Other manufactured tobacco and manufactured tobacco substitutes; "homogenous" and "reconstituted’’ tobacco; tobacco extracts and essences. |
5 per stamp |
|
4 |
Electronic cigarettes and other nicotine delivery devices |
5 per stamp |
|
5 |
Liquid nicotine for electronic cigarettes |
5 per stamp |
|
6 |
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 matters relating to health. |
5 per stamp |
|
7 |
Wines including fortified wines, and other alcoholic beverages obtained by fermentation of fruits |
5 per stamp |
|
8 |
Compounded spirits of alcoholic strength exceeding 6% |
3 per stamp |
|
9 |
Spirituous beverages of alcoholic strength not exceeding 6% |
3 per stamp |
|
10 |
Beer, Cider, Perry, Mead, Opaque beer, and mixtures of fermented beverages with non-alcoholic beverages |
3 per stamp |
|
11 |
Bottled or similarly packaged waters |
0.5 per stamp |
|
12 |
Other non-alcoholic beverages, not including fruit and vegetable juices. |
2.2 per stamp |
|
13 |
Fruit juices (including grape must), and vegetable juices, fermented and not containing added spirit, whether or not containing added sugar or other sweetening matter |
2.2 per stamp |
|
14 |
Cosmetics and Beauty products of tariff heading 3303, 3304, 3305 and 3307 |
2.5 per stamp |
How does one get the excise stamps?
Excise stamps are issued by KRA to licensed persons only. Applications for excise stamps are made through the EGMS system. However, a person can initiate the process at an EGMS Service Desk in the various KRA Tax Service Offices.
Handling of Excise Stamps with Quality Concerns
We have developed a userguide for taxpayers with concerns about the quality of excise stamps. The steps include the following:
- Stamps quality incident reporting. This is done through the email- egmshelp@kra.go.ke with relevant details.
- Verification of stamps with quality concern
- Procedure to return the Stamps in EGMS
- Returning physical stamps to KRA
Ever Heard of the Soma Label App?
Soma label is a mobile application that supports EGMS. The application enables consumers to verify the authenticity of excise stamps affixed on products.
