Excise Duty Return

An Excise Duty Return in Kenya reports the figures a taxpayer must declare so the correct liability can be assessed.

Excise duty in Kenya is levied on a specified range of goods and services deemed to generate externalities or to be subject to revenue-raising measures. The First Schedule to the Excise Duty Act No. 23 of 2015 lists the excisable goods — including beer, wines and spirits, tobacco products, petroleum products, motor vehicles of certain engine capacities, cellular mobile phones, confectionery, bottled water, and plastic bags — together with the applicable specific or ad valorem duty rates. The Finance Acts enacted annually by the National Assembly routinely amend the First Schedule to adjust duty rates and add new categories of excisable goods or services.

The excise duty return mechanism in Kenya operates through the KRA's iTax platform (itax.kra.go.ke), which replaced the paper-based filing system. Licensed manufacturers file monthly returns reflecting excisable goods manufactured and removed from the factory during the month. Importers account for excise duty at the point of importation through the customs declaration lodged on the KRA's Integrated Customs Management System (iCMS), and the excise duty is assessed before clearance at the port of entry. Service providers — including mobile money transfer service providers, money transfer agencies, and betting companies — file monthly service excise returns reflecting the value of excisable services supplied.

The Kenya Revenue Authority issues an Excise Duty Licence to manufacturers of excisable goods under s.15 of the Excise Duty Act, and the Alcohol Control Act No. 4 of 2010 additionally regulates the manufacture and sale of alcoholic beverages through the licensing framework administered by the Alcoholic Drinks Control Board. Excise duty stamps — physical or electronic authentication marks applied to individual product units — are required for alcoholic beverages, tobacco products, and certain other goods under the Kenya Revenue Authority (Excise Duty Stamps) Order 2017.

Forms-legal.com provides an Excise Duty Return template that captures all disclosure requirements under the Excise Duty Act No. 23 of 2015 and guides licensed manufacturers and importers through the monthly filing process. Under Kenya law, Section 3 of the Companies Act 2015 (No. 17 of 2015) and Section 25 of the Data Protection Act 2019 (No. 24 of 2019) govern the core requirements for this type of document.

The legal framework governing the Excise Duty Return in Kenya draws on several key statutes and regulatory bodies. Under Kenyan law, the Constitution of Kenya 2010 is the supreme law. The Law of Contract Act (Cap. 23) governs contractual obligations. The Kenya Revenue Authority (KRA) administers tax under the Income Tax Act (Cap. 470). The High Court of Kenya, established under Article 165 of the Constitution, has unlimited original jurisdiction. The Data Protection Act No. 24 of 2019 and the Office of the Data Protection Commissioner (ODPC) govern personal data. Parties executing a Excise Duty Return in Kenya should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Excise Duty Act No. 23 of 2015 sets the foundational requirements.

An Excise Duty Return must be filed in Kenya by every person or entity that holds an Excise Duty Licence issued by the Kenya Revenue Authority under s.15 of the Excise Duty Act No. 23 of 2015. The obligation to file arises monthly — returns must be submitted by the twentieth day of the month following the accounting period — regardless of whether any excisable goods were manufactured or supplied during that period. A nil return must be filed where there is no activity.

Businesses that must file excise duty returns include: manufacturers of alcoholic beverages (beer, wines, spirits, cider) regulated under the Alcohol Control Act No. 4 of 2010; manufacturers and importers of tobacco products regulated under the Tobacco Control Act No. 4 of 2007; manufacturers and importers of petroleum products subject to the Petroleum Act No. 3 of 2019; importers and local assemblers of motor vehicles with engine capacities attracting excise duty under the First Schedule to the Excise Duty Act; manufacturers of bottled water, juices, and non-alcoholic beverages listed in the First Schedule; suppliers of betting, gaming, and lottery services regulated by the Betting Control and Licensing Board under the Betting, Lotteries and Gaming Act Cap. 131; mobile money transfer service providers and money transfer agencies; and manufacturers of plastic bags subject to the progressive excise duty introduced to complement the Environmental Management and Coordination Act No. 8 of 1999.

Importers are required to complete excise duty documentation as part of the customs clearance process at the point of entry, but licensed domestic manufacturers must file separate monthly manufacturing returns irrespective of whether duty has been paid on raw materials imported. Where a business undergoes a change in ownership, ceases manufacturing, or temporarily suspends operations, the Excise Duty Licence must be updated and KRA notified within the timelines prescribed in the Excise Duty Act to avoid accumulation of monthly filing obligations. Under Kenya law, Section 3 of the Companies Act 2015 (No. 17 of 2015) and Section 25 of the Data Protection Act 2019 (No. 24 of 2019) govern the core requirements for this type of document.

A complete and accurate Excise Duty Return filed with the Kenya Revenue Authority under the Excise Duty Act No. 23 of 2015 must include the following key elements.

**Taxpayer Identification.** The taxpayer's full legal name, KRA Personal Identification Number (KRA PIN), Excise Duty Licence number issued under s.15 of the Act, business registration number (from the Registrar of Companies or Business Registration Service under the Business Registration Service Act No. 15 of 2015), physical address of the manufacturing premises or service location, and the return period (calendar month and year).

**Opening and Closing Stock.** A reconciliation of excisable goods in stock at the opening and closing of the accounting period. For manufacturers, this means the quantity of finished goods, work-in-progress, and raw materials held in the licensed manufacturing premises. For excise duty purposes, goods are subject to duty upon removal from the factory, not upon manufacture.

**Production and Importation Data.** A schedule showing the total quantity of each category of excisable goods produced or imported during the period, listed by the tariff heading specified in the First Schedule to the Excise Duty Act and cross-referenced to the applicable specific (KES per unit, per litre, per kilogram) or ad valorem (percentage of ex-factory or customs value) rate.

**Removals and Supplies.** The total quantity of excisable goods removed from the factory for supply — including goods supplied locally, goods exported (which may be entitled to relief from excise duty under s.23 of the Act), goods supplied to duty-free shops licensed under the Customs and Excise legislation, and goods destroyed under KRA supervision and therefore not subject to duty. For service providers, the total value of excisable services supplied during the period.

**Excise Duty Stamps Reconciliation.** Where excise duty stamps are required under the Kenya Revenue Authority (Excise Duty Stamps) Order 2017 — including for beer, spirits, wine, and tobacco — a reconciliation of stamps received from KRA, stamps affixed to goods during the period, and stamps remaining in stock. Discrepancies in stamp reconciliation are a major audit trigger.

**Excise Duty Payable.** The total excise duty payable on taxable removals and supplies for the period, calculated by applying the applicable rate to the quantity or value of goods removed. Where multiple product categories attract different rates — for example, a manufacturer producing both beer (specific rate per litre) and non-alcoholic beverages (specific rate per litre) — the duty must be calculated and disclosed separately for each category.

**Input Tax Relief.** Where excise duty has been paid on inputs used in the manufacture of excisable goods that are themselves subject to excise duty, s.24 of the Excise Duty Act may provide for relief from double taxation. The return must disclose the value of any such relief claimed and the supporting documentation.

**Net Duty Payable.** The net excise duty payable after deducting any allowable reliefs, refunds due from prior periods, and payments already made through advance instalment arrangements, together with any penalties and interest accrued for late payment under s.40 of the Excise Duty Act.

**Authorised Signatory Declaration.** A declaration by an authorised officer of the taxpayer (director, company secretary, or designated tax representative) confirming the accuracy and completeness of the return, consistent with the requirement under the Tax Procedures Act No. 29 of 2015 s.35.

Forms-legal.com provides an Excise Duty Return template that covers all these elements in the format aligned with KRA's iTax system requirements. Under Kenya law, Section 3 of the Companies Act 2015 (No. 17 of 2015) and Section 25 of the Data Protection Act 2019 (No. 24 of 2019) govern the core requirements for this type of document.