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KRA removes excise duty on bottled water
06th July, 2026 12:54 PM
The Kenya Revenue Authority (KRA) has announced the removal of excise duty on bottled water, offering a major tax relief to manufacturers, importers and potentially millions of consumers across the country.
In a public notice issued on Monday, July 6, 2026, KRA said the change took effect from July 1, 2026 following amendments introduced under the Finance Act, 2026. The amendment removes bottled water from the list of goods subject to excise duty, meaning newly manufactured or imported bottled water will no longer attract the tax.
“Kenya Revenue Authority notifies all licensed manufacturers and importers of bottled water and the general public that pursuant to the Finance Act, 2026 (amending the First Schedule to the Excise Duty Act, Cap 472), excise duty on bottled water is removed with effect from 1st July, 2026,” the notice read.
The move also marks the end of mandatory excise stamps on bottled water. KRA said bottled water manufactured or imported on or after July 1, 2026, will no longer require excise stamps, bringing to a close a system that has for years been used to monitor tax compliance in the sector. Manufacturers have previously been required to purchase and affix digital excise stamps on every bottle before the products entered the market.
“Bottled water manufactured or imported on or after this date will not be subject to excise duty and will not be required to be affixed with excise stamps,” KRA stated.
KRA said it will soon issue detailed guidelines on how manufacturers should return unused excise stamps and deactivate the digital stamps that are no longer required. The guidelines will be published on the authority’s official website.
“The Commissioner will issue detailed guidelines on the return of unutilized stamps and the decommissioning of digital stamps, which will be published on the official KRA website,” the tax authority said.
The tax relief is one of the notable changes introduced under the Finance Act, 2026, which came into force on July 1, 2026. The removal of excise duty is expected to reduce compliance costs for manufacturers and could encourage greater competition within the bottled water industry. Consumers will also be hoping that the savings eventually trickle down to retail prices.
Even with the changes, KRA reminded manufacturers that existing tax obligations remain in place for the previous month. The authority directed all licensed manufacturers to file their June 2026 Excise Duty Returns and settle any taxes due by July 20, 2026.
“Manufacturers are reminded of their obligation to submit their Excise Duty Returns for June 2026 and pay the taxes due by 20th July, 2026,” KRA said.
