The Excise Duty (Excisable Goods Management System) Regulations, 2017 have recently been published in the Kenya Gazette

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The Excise Duty (Excisable Goods Management System) Regulations, 2017

The Excise Duty (Excisable Goods Management System) Regulations, 2017 have recently been published in the Kenya Gazette Supplement No. 44 under Legal Notice No. 48.

Requirement for Affixing of Excise Stamps

Every package of excisable goods, except motor vehicles, manufactured in or imported into Kenya, are required to be affixed with an excise stamp. The purpose of this is to:

  • deter counterfeiting;
  • facilitate tracking of the stamps and excisable goods along the supply chain;
  • enable accounting for the production of excisable goods manufactured or imported; and
  • Facilitate any persons in the supply chain to authenticate the stamps and excisable goods.

New Charges on Excise Stamp Fees

The Regulations have introduced Excise stamp fees to be charged on excise stamps for different types of excisable goods. The excise stamp fees shall be paid to the Commissioner of Revenue by the manufacturers and importers of excisable good based on quantity of stamps issued to them. Below is a summary table that shows the category of goods and the excise stamp fees charged:

Category of excisable goods Fees
Cigars, cheroots, cigarillos, containing tobacco or tobacco substitutes 2.8 per stamp
Cigarettes containing tobacco or tobacco Substitutes
Other manufactured tobacco and manufactured tobacco substitutes;

“homogenous” and “reconstituted tobacco”; tobacco extracts and

essences

Wines including fortified wines, and other alcoholic beverages obtained by fermentation of fruits 2.8 per stamp
Compounded spirits of alcoholic strength exceeding 10% 2.8 per stamp
Spirituous beverages of alcoholic strength not exceeding 10% 1.5 per stamp
Beer, Cider, Perry, Mead, Opaque beer and mixtures of fermented beverages with non-alcoholic beverages 1.5 per stamp
Mineral water and aerated water of tariff no. 2201.10.00 0.5 per stamp
Fruit juices (including grape must), and vegetable juices, unfermented and not containing added spirit, whether or not containing added sugar or other sweetening matter 0.6 per stamp
Sweetened or flavoured water and non-alcoholic beverages not including fruit or vegetable juices of tariff heading 2202 0.6 per stamp
Cosmetics and Beauty products of tariff heading Nos. 3303, 3304, 3305 and 3307 0.6 per stamp

The Procedure for Application of Excise Stamp to the Commissioner

A manufacturer or importer of excisable goods is required to apply to the Commissioner for excise stamps in a prescribed form at least sixty days before the manufacture or importation of the excisable goods. Payment of the excise stamp fees by a manufacturer or importer of excisable goods shall be made after the Commissioner approval of the application. However, the Commissioner may impose, issue excise stamps to an importer of excisable goods before importation. Proof of importation by an importer of excisable goods maybe required by the Commissioner before issuing the importer with the excise stamps.

Manner of Affixing Excise Stamps

Excise stamps are expected to be affixed on excisable goods in the following manner specified by the Commissioner:

  • in case of locally manufactured goods, at the production facility immediately after packaging; or
  • in the case of imported goods, at a place approved by the Commissioner within five days of the clearance for importation of the goods for home use:

Excise stamps on imported excisable goods to be affixed at the production facility in the exporting country may be allowed in accordance with such conditions as the Commissioner might specify. In addition, the Commissioner can upon the application by the manufacturer or importer, permit digital stamps to be printed by the System on each package and in a visible place with indelible security ink to enable the authentication of, tracking and tracing of, and production accounting for excisable goods.

Transfer of Excise Stamps

Transfer of excise stamps held in stock by a manufacturer or importer of excisable goods to another manufacturing or importing unit owned by the same manufacturer or importer is permitted subject to the prior approval of the Commissioner. Transfers carried out without the commissioner’s approval is deemed as an offence.

The commissioner is required to prescribe the procedure and conditions for transfer and accounting of the excise stamps.

Duty Free Goods

Packages of duty free or export excisable goods specified in the Regulations are required to bear distinct markings to enable the goods to be trackable and traceable.

In addition, the Regulations make it a requirement for any material wrapping package for wholesale purposes to have the following printed on it:

  • in the case of exports, the country of final destination;
  • in the case of excisable goods for consumption in Kenya, “For Use In Kenya”;
  • in the case of excisable goods for sale to duty-free shops, or Diplomatic shops, “Duty Free”;
  • in the case of excisable goods for consumption by Kenya Defence Forces, “Kenya Defence Forces” and,
  • in the case of excisable goods for consumption by National Police Service, “ National Police Service”

Exempt Goods from Excise Stamp Charges

The regulations exempts the following excisable goods from the requirement of excise stamps—

  • excisable goods manufactured for export, the Kenya Defence Forces, the National Police Service or delivered to a duty free shop;
  • excisable goods imported or purchased from a duty free shop by privileged persons or institutions listed in the Second Schedule to the Act; and
  • excisable goods imported into Kenya as samples which shall have been exempted from import duty under the Fifth Schedule to the East African Community Customs Management Act, 2004.

In case of any inquiries on the Regulations please contact miriam.bomett@kam.co.ke.  For application on Duty Remission, please contact halima.khalla@kam.co.ke.

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