KRA tax goal rises Sh19bn after bar hours extended

The Treasury has raised the target for excise duty this financial year by Sh18.6 billion on the back of longer operating hours for entertainment joints and increased rates of taxation.

Treasury secretary Ukur Yatani in the latest projection expects the Kenya Revenue Authority (KRA) to collect Sh259.6 billion in excise taxes compared with Sh241 billion in the budget approved by lawmakers in June.

The higher goal in the draft Budget Policy Statement (BPS) for 2022 comes in the wake of this month’s 4.97 percent raise to reflect average annual inflation for the year ended June 2021.

Tax on about 30 excisable goods such as beer, bottled water, juice and motorcycles (boda bodas) was raised from November 2, with the taxman targeting an additional Shh3.7 billion from inflation-adjusted taxation.

Petroleum products have, however, been spared the increment pending determination of a case opposing the annual inflation-adjusted duty on fuel in the High Court.

Excise tax collections have also been boosted by longer operating hours for bars and restaurants to 11 pm from October 21 as part of relaxed Covid-19 restrictions which included the lifting of an 18-month nighttime curfew.

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