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Bars closure punches Sh45bn hole in budget

Photo credit: File | Nation Media Group

What you need to know:

  • Kenya shut down bars on March 25 and in July banned restaurants from selling alcohol to contain the virus.
  • Alcohol sales have plummeted as businesses continue to reel from the directive.
  • Mr Kenyatta last month set the stage for reopening of bars and night clubs.

Prolonged closure of bars and night clubs has forced the Treasury to cut its excise tax projections by Sh45.8 billion, giving the government a fresh revenue collection headache three months since the start of the financial year.

Treasury Cabinet Secretary Ukur Yatani has lowered the excise duty target — the bulk of which come from sale of alcohol and cigarettes — to Sh195.6 billion from the Sh241.4 billion set in June despite a scheduled raise on the tax from October 1.