Kenya’s Proposed Import Duty on Crude Palm Oil May Raise Cooking Oil and Soap Prices
Kenyans might face higher prices for cooking oil and soap if the Kenyan government enacts a proposal to impose a 10% import duty on crude palm oil.
A gazette notice from the East African Community dated June 30 announced that Kenya is considering this duty rate for one year.
In the previous financial year 2023/2024, crude palm oil was exempt from import duties.
The notice indicated that Uganda and Kenya plan to apply a 10% duty rate on crude palm oil for one year instead of the EAC CET rate of 0%.
Crude palm oil is a key raw material for producing vegetable cooking oil in Kenya.
Palm oil is also crucial in making bar soap, a staple product in Kenyan homes.
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Kenya primarily imports crude palm oil from Malaysia and Indonesia for its manufacturing industry.
This potential cost increase comes after the government withdrew the 2024 Finance Bill, which proposed higher taxes on cooking oil.
If implemented, Kenyans will need to spend more on this essential commodity.
Earlier this year, a foreign investor in Kenya’s cooking oil industry criticized the country’s taxation policies, calling them unpredictable and discouraging to investors.
The investor, whose company has operated for over 86 years in 14 countries, said he had never encountered such instability in tax policies, describing Kenya’s as the most unstable.
The manufacturer called on the government to tax end products instead of raw materials to reduce manufacturing costs.
Kenya’s Proposed Import Duty on Crude Palm Oil May Raise Cooking Oil and Soap Prices