The Ministry of Finance has proposed a significant increase in excise duty on beer manufactured from local raw materials, sparking concerns among beer enthusiasts.
The tax rate is set to rise from Shs650 to Shs900 per liter, a 38% hike. Minister of State for Finance Henry Musasizi emphasized that the tax adjustment is necessary to reflect economic conditions and inflationary pressures.
“The excise duty on beer manufactured from local raw materials will increase from Shs650 to Shs900. This is meant to ensure that taxation remains fair while keeping pace with the current economic realities,” Musasizi stated.
The government expects to raise an additional Shs19.40Bn from the proposed tax measures, which also include an increment on cigarettes. Musasizi noted that the excise duty on some products, including cigarettes, had not been adjusted since the 2017-18 financial year despite inflation rising by 28.8% over the same period.
The proposed increase on beer taxes comes as part of wider efforts to boost domestic revenue collection. The government argues that the adjustment will ensure sustainable funding for key sectors while addressing inflation-driven fiscal gaps.
Parliament is currently reviewing the proposed tax amendments, which are among seven Tax Bills under discussion. If approved, beer consumers should expect to pay more as the new excise duty takes effect in the upcoming financial year.
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