KRA removes excise duty on bottled water under Finance Act 2026

The Kenya Revenue Authority (KRA) has announced that bottled water manufactured or imported into the country will no longer attract excise duty or require excise stamps following changes introduced under the Finance Act, 2026.

In a public notice issued on Monday, KRA said the changes took effect on July 1, 2026, after the Finance Act amended the First Schedule to the Excise Duty Act, Cap 472.

The authority said bottled water manufactured or imported on or after July 1 will no longer be subject to excise duty and will not require excise stamps.

"From 1st July 2026, bottled water manufactured or imported in Kenya will no longer be subject to excise duty and will not require excise stamps," KRA said in the notice.

Despite the removal of the tax, KRA directed manufacturers to comply with their outstanding tax obligations for June 2026.

The authority reminded manufacturers to file their June 2026 Excise Duty Returns and pay all taxes due by July 20, 2026.

"Manufacturers are reminded to file their June 2026 Excise Duty Returns and pay taxes due by 20th July 2026," the notice stated.

KRA said the changes are in line with the provisions of the Finance Act, 2026, which amended the Excise Duty Act to remove bottled water from the list of excisable goods.

The authority also said further guidance would be issued on how manufacturers and importers should handle excise stamps that remain unused following the removal of the tax.

According to the notice, the Commissioner will publish detailed guidelines on the return of unutilised excise stamps and the decommissioning of digital excise stamps through the KRA website.

KRA advised affected manufacturers and importers to monitor the authority's official communication channels for the forthcoming guidelines.

Manufacturers and other affected taxpayers seeking clarification have been advised to contact KRA's Enforcement Division through the telephone numbers provided in the notice or via the authority's official email address.