RUTO to tax diapers, sanitary pads and fertilizer in the tax changes even after Gen Z rejected the move – Look!


Wednesday, November 6, 2024 - Kenyans might have to pay more for diapers and sanitary towels after the government plans to resuscitate its initial plan to convert them from zero-rated to exempt status under the Eco Levy.

While items under the exempt schedule do not attract the 16 per cent Value Added Tax (VAT), the manufacturers cannot, however, claim the input tax on the items used to produce the final product, forcing the suppliers to pass on the cost to the final consumer.

Moving zero-rated goods to the exempt status will drive up the consumer prices of sanitary towels and diapers, items that already cost high for Kenyans.

The Eco Levy, a proposal under the Miscellaneous Fees and Levies Act (MFLA), is aimed at charging manufacturers and importers whose goods affected the environment.

President William Ruto halted this move after Kenyans went on a rampage and protested against the Finance Bill 2024. The Bill had proposed only the exported goods and services would be zero-rated.

According to the Cabinet Secretary, the move to give the exempt status aimed to reduce the government’s tax expenditure of the government’s estimated revenue forgone after giving tax concessions or preferences to a particular class of taxpayer or activity.

Apart from the diapers and sanitary towels, other items that have been reclassified from zero to exempt status are inputs and raw materials (locally or imported) supplied to manufacturers of agricultural pest control products upon recommendation.

Fertilizers and the raw materials used to manufacture these inputs, as well as pesticides and the raw materials used to manufacture them are also expected to shoot up in prices.

The Kenyan DAILY POST

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