Cooking oil manufacturers have warned of an increase in the prices of the crucial commodity if the Finance Bill 2024 is passed in its current form.
In a statement to newsrooms, the manufacturers under the Edible Oil Sub Sector of the Kenya Association of Manufacturers asked for the drop of the proposed 25 per cent excise duty.
“In light of these grave implications, we urgently call upon the government to scrap the proposed 25 per cent excise duty on vegetable oils from the Finance Bill 2024,”
“This tax is not just an economic miscalculation; it is a potential humanitarian crisis that Kenya cannot afford.”
The Bill that is currently undergoing public participation had proposed 25 per cent Excise Duty on vegetable oils.
The tax is slated to apply to both raw materials and refined oils.
According to the manufacturers, the proposal will cause serious price hikes on the commodity.
In their estimation, the cost of the cooking oil will increase by 80 per cent.
The move is likely to make life harder for low-income families who depend on the essential commodity daily.
Cooking oil is a fundamental ingredient in a myriad of everyday foods such as bread, mandazis, chapatis, and chips.
“The excise duty will cause a cascading effect on these items, inflating the price of a standard loaf of bread (400g) from Sh70 to Sh80,” the statement reads.
“The ripple effects extend beyond the kitchen, affecting other essential products derived from vegetable oils.”
“The price of long bar soap could escalate from Sh180 to Sh270, and margarine (250g) from Sh160 to a staggering Sh300.”
The statement further warns that the proposed tax will deal a blow to the Kenya Kwanza’s agenda of promoting local manufacturing.
“Moreover, the edible oils sector is a significant contributor to Kenya’s economy, directly employing approximately 10,000 individuals and indirectly supporting over 30,000 jobs. The proposed tax risks decimating these livelihoods and destabilizing the manufacturing industry at large,” the statement reads.
