Kenya Breweries boss seeks review of turnover tax on businesses

Samson Thuranira who won homemakers worth Sh50, 000 in the Kenya Brewery's 'Shikisha Form na Senator' promotion poses with his winnings at Lims Distributor in Meru County.[Phares Mutembei,Standard]

Kenya Breweries Ltd (KBL) wants the Government to review taxation in the liquor industry, saying expensive alcohol was forcing many Kenyans to consume illicit brews.

Speaking during the opening of Senator Keg Lager’s Lims distributorship at Muriri in Meru County, KBL Managing Director John Musunga appealed to the Government to rethink the one per cent turnover tax on alcohol outlets.

He said the tax had the potential to make small businesses unviable.

While applauding the Government’s tax concessions to the corporate world last year, Musunga said the one per cent tax could hit smaller businesses in the industry hard.

He, however, lauded Treasury’s reduction of corporate tax from 30 per cent to 25 per cent last year, noting it protected the brewer from the shocks of the Covid-19 pandemic.

“That reduction helped the industry to retain staff, without having to retrench or reduce salaries and that was a huge boost to the business and the economy,” he said. “We have not, however, recovered fully from the effects of the pandemic and the economic circumstances in Kenya are still difficult.”

He urged the State to continue partnering with the industry and moot innovative ways that cushion them against the impacts of Covid-19 and its effects on business.

Reduced tax

KBL boss said the curfew hours where bars close early made it difficult for the liquor business to thrive.

Mr Musunga said the reduced tax would see smaller outfits like distributors dealing with the senator keg brand sustain operations in the difficult Covid-19 times.

He said ‘senator larger’ was a government and KBL initiative, targeted at the lower end of the market to ensure consumers receive a quality beer at an affordable price.

“This partnership has enabled Kenyans to consume quality, affordable beer and avoid dangers of illicit brews,” he said.

Lims distributorship Managing Director Nicholas Limeri with distribution footprints in Meru, Isiolo and Marsabit for the last 15 years rooted for quality and affordable beer brands.