Bar owners and staff nationwide are lamenting the surge in excise taxes on alcohol, attributing it to a significant shift in consumer spending habits.

In response to the escalating prices of legitimate alcoholic beverages, consumers are increasingly turning to illicit alternatives and more affordable options.

A substantial portion of patrons who have shifted to consuming illicit alcohol were formerly regular consumers of legal alcohol and cigarettes, a trend noted since the initiation of double annual excise tax hikes on spirits in 2015, as per government policy reviews.

Alfred Kiama, a bartender in Ruaraka, shared with Kenyans.co.ke that he has witnessed nearly half of his clientele migrating to cheaper wine and spirits establishments in the vicinity. “More and more customers are departing due to the escalating prices; we are unable to lower our prices due to the necessity of keeping up with excise taxes. Despite ongoing losses, we remain hopeful that business will rebound,” remarked Kiama.

Illicit alcohol now constitutes a significant majority of alcohol consumption in the country, surpassing half of the total consumption.

James Shitema, a local brewer in Luanda, Vihiga county, noted a loyal customer base for his brew but acknowledged a modest increase in new faces frequenting the establishment.

Alcohol manufacturers are urging the government to reconsider and reduce excise taxes on alcoholic products, emphasizing that the current tax structure encourages the consumption of illicit alcohol.

Describing it as a “nuisance and cumbersome,” manufacturers raised concerns about the financial burden imposed on their operations, necessitating the creation of additional administrative infrastructure. They expressed worries about the impact on smaller businesses that may lack the capacity to absorb such financial strains during a past press conference.

Also read Woman Charged With Stealing 7.2 Million worth of alcohol

Interestingly, while excise taxes from beer and cigarettes have declined over the past five years, a report from the Kenya National Bureau of Statistics (KNBS) reveals that revenue collected from taxes on products such as airtime has increased by over 50 percent within the same tax category.