The Kenya Association of Manufacturers (KAM) has moved to court to challenge a 433 percent increase in excise duty on imported industrial sugar, warning that the higher tax could raise production costs, threaten jobs and weaken the competitiveness of local manufacturers.The association has filed a constitutional petition at the Milimani High Court against the State Law Office, the Kenya Revenue Authority (KRA) and two other respondents, challenging the increase introduced under the Finance Act, 2026.The association has filed a constitutional petition at the Milimani High Court against the State Law Office, the Kenya Revenue Authority (KRA) and two other respondents, challenging the increase introduced under the Finance Act, 2026.
KAM says the duty on imported industrial sugar rose from Sh7.50 per kilogram to Sh40 per kilogram effective July 1, 2026, increasing the cost of a key input for manufacturers that use sugar in their production processes.
KAM says the duty on imported industrial sugar rose from Sh7.50 per kilogram to Sh40 per kilogram effective July 1, 2026, increasing the cost of a key input for manufacturers that use sugar in their production processes.Higher production expenses could affect pricing decisions and the ability of Kenyan firms to compete regionally, although the projected impact will depend on individual manufacturers’ reliance on imported sugar and their ability to absorb or pass on the additional costs.
KAM is also challenging the process through which the higher rate was introduced, arguing that there was inadequate public participation before the tax increase took effect.Higher production expenses could affect pricing decisions and the ability of Kenyan firms to compete regionally, although the projected impact will depend on individual manufacturers’ reliance on imported sugar and their ability to absorb or pass on the additional costs.
