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Millions of Kenyan consumers of beauty products such as wigs, false beards and eyebrows may not be able to afford it anymore or could be forced to pay more for the items starting July.
On May 4, the National Treasury submitted the 2023 Finance Bill to Parliament for the first reading. One of the proposals in the Bill is the introduction of a 5 per cent excise duty on beauty products.
If adopted, the proposal to introduce the tax may have a great impact on dealers and consumers of beauty products.
The retailers, service providers and consumers of these beauty products have now raised their concerns noting that the proposed tax, doubled with the high cost of living, will be a nightmare for them.
Kelvin Kamotho, a beautician specialising in microblading at Mkenya True Brows, lamented that the tax will further suppress him because the cost of acquiring the products he uses is already high.
"Things are expensive where we source them from. Every beauty product is expensive now. Convincing a customer to pay more for services is going to be difficult, they may end up not coming for our services anymore," Kamotho said.
He said he fears losing customers, noting that they may not understand that the initial cost of products has hiked. Kamotho said he has a supplier who imports from china and UK.
"Clearance is paid for, and it affects prices too".
Increased costs
The beautician, who started his business eight years ago said prices have changed over the years. "For instance, the pigment/ink was initially Sh7,000 but is currently going for Sh10,000 for one. The needles we use initially cost Sh100, but now they cost Sh300."
Kamotho said if the tax is adopted, a service he is currently charging Sh10,000, may cost customers up to Sh17,000.
"I can't charge too high, because customers may go elsewhere for cheap services.
"Some people use cheap ink for microblading, but it doesn't work well," he said.
Kamotho said that however much he hikes his prices, his business will have remained scarred due to the high cost of operations.
"Power units (tokens) have reduced, meaning I use more money to purchase power as my machine uses electricity. At the moment there is little or no profit, as most of the money goes to servicing the business," he lamented.
The move to tax beauty products will raise the prices of these beauty products whose usage is on the rise. Official data shows that the industry has grown by over Sh10 billion over the past decade as more Kenyans embrace the use of make-up and other beauty products.
Experts have cautioned that the rise in excise duty on cosmetics and hygiene sub-sector will increase the tax burden to untenable levels and subsequently make these products unaffordable to consumers.
The Kenyan beauty industry has grown exponentially over the past few years, mainly due to increased consumer demand for quality cosmetics and skin care products and services.
The growth in the industry, despite attracting international investments such as Fenty Beauty and Black Opal also provides a new revenue stream for the government, thus the taxman's growing interest in collecting taxes from the sector.
Beauty routine
Wigs, false beards, eyebrows, and eyelashes, as well as artificial nails, for many Kenyans, these items are an essential part of their beauty routine.
"Women go for permanent brows because it saves them time. They also go for nail acrylics because it serves them for long," Kamotho explained the increased popularity, noting that times have also changed.
To Echo Kamotho's views on why people prefer beauty products Angela Okumu, a business lady and tailor says for her, wigs are a convenient option.
"It is cheaper in the long run especially when you invest in quality wigs. Plaiting hair was proving to be quite expensive and time-consuming," she said fearing that if the tax is imposed, her consumption of the beauty products may go down due to the increase in prices.
"I don't think I will be able to afford wigs anymore, personally after this I am definitely going natural," she added.
She however notes that for her, the 5% taxation is not outrageous especially that it is on artificial beauty products. "We'd rather have increased taxes on that rather than on products that are needs."
"I think in the long run it will not benefit the economy since it is a product that people can do without," Miss Okumu said.
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