Manufacturers want State to stay implementation of oil import duty
By Print Reporter, July 4, 2024Manufacturers of edible oil now want the government to stay the implementation of the 10 percent Import Duty imposed under the East Africa Community Common (EAC) External Tariff.
Edible Oil Manufacturers Association of Kenya lamented that the introduction of a 10 percent import duty by Kenya on crude oil, a key raw material used in the production of cooking oil will lead to significant price increases for cooking oil, an essential staple household for millions of Kenyans.
“With cooking oil also being an important component in production of essential everyday products like soap, bread, mandazi, chapatis and margarine the prices of these essential household products will also go up and further push up the cost of living for millions of struggling Kenyans,” said the association in a statement.
Vegetable oil
This new 10 percent import duty on crude palm oil and other vegetable cooking oils that came into effect this month is a result of Kenya’s application of East African community common external Tariff to raise import duty on crude palm oil from the current zero rate to 10 percent and was published in the EAC Gazette No.18 on 30th June 2024.
This new levy is being implemented only days after President William Ruto declined to sign the controversial and punitive finance bill 2024 after massive demonstrations against it by Kenyans across the country.
The finance bill 2024 had proposed the introduction of a punitive 25 percent tax on both raw and refined vegetable oils.
“The abrupt introduction of these new taxes on crude palm oil and other vegetable cooking oils was done secretly, without any public participation and will increase the cost of living for millions of Kenyans and push them further to deeper financial distress,” noted the manufacturers.
Read the statement, “In view of the ongoing uproar and demonstrations against tax hikes across the country, we call upon the government to urgently seek a stay of execution of this new taxes as this single act will cushion millions of Kenyan consumers, especially the vulnerable ones against imminent significant price hikes for these essential household products.”
During the clamor for the rejection of the Finance Bill 2024, the manufacturers warned of an increase in the prices of the crucial commodity if the contentious bill was to be passed in its current form.
They claimed that the new tax would have pushed the price of cooking oil by a whopping 80 percent. The manufacturers said the proposed 25 per cent excise duty would have killed the industry which is key to the country’s economy.