The Kenya Association of Manufacturers Edible Oil Sub Sector has warned about the proposed 25 percent excise duty on vegetable oils included in the Finance Bill 2024.
In a statement, KAM stated the severe economic and social repercussions the tax could have on households and the broader industry.
“We urgently call upon the government to scrap the proposed 25% excise duty on vegetable oils from the Finance Bill 2024. This tax is not just an economic miscalculation but a potential humanitarian crisis Kenya cannot afford.”
The proposed excise duty will apply to raw materials and refined cooking oils, threatening to significantly increase the price of cooking oil, a staple commodity in every household.
Further, KAM predicts that this tax will cause the price of cooking oil to surge by 80%, making it unaffordable for millions of Kenyans, particularly those with low incomes and small-scale traders, commonly referred to as “hustlers” and “mama mbogas.
Did you read this?
“The excise duty will cause a cascading effect on these items, inflating the price of a standard loaf of bread (400g) from Kes 70 to Kes 80,”
“Additionally, the price of long bar soap could escalate from Kes 180 to Kes 270, and margarine (250g) from Kes 160 to Kes 300,”
The association emphasized that such price hikes will disproportionately impact society's most vulnerable members, exacerbating the already high cost of living and plunging millions into deeper financial distress.
They argue that the proposed tax would undermine the government’s efforts to promote local value addition in agribusiness and could hinder the growth of local edible oil production.
“Cooking oil is not just an isolated product; it is a fundamental ingredient in a myriad of everyday foods such as bread, mandazis, chapatis, and chips,” the statement read.
The edible oils sector significantly contributes to Kenya’s economy, directly employing approximately 10,000 individuals and indirectly supporting over 30,000 jobs.
