EABL pays Ksh.64bn in tax to regional treasuries

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Examples of Beers under the EABL brand.
Examples of Beers under the EABL brand. PHOTO/COURTESY: eabl.com

East Africa Breweries Limited (EABL) remitted tax worth Ksh. 64 billion to national treasuries in Kenya, Uganda and Tanzania in the year ending December 2018, the firm’s annual results for the period have shown.

The 18 percent increase in tax remitted to the regional exchequers has been attributed to improved sales from the company. According to the firm, Kenya Uganda and Tanzania recorded improved sales of beer and spirits which contributed to the firm’s total revenues increasing by 12 percent to Ksh. 82.54 billion up from Ksh. 73.45 billion recorded in 2017.

 “Our efficiency and agility, coupled with a relatively stable macroeconomic environment, have provided tailwinds for better performance, with EABL returning organic volume of 11 per cent and net sales growth of 12 per cent,” said Group managing director Andrew Cowan.

EABL’s revenues in Uganda and Tanzania grew by eight percent and 20 percent respectively while Kenya’s went up 13 percent. The Uganda and Tanzania subsidiaries contributed 15 percent and 12 percent respectively to EABL’s profits in the period while Kenya contributed the remaining 73 percent.

The improved performance from the Kenyan subsidiary has been attributed to increased consumption of EABL’s low-end lager Senator Keg in the period under review.

Despite posting positive results, EABL underscored that the government’s decision to increase excise duty tax on beer and spirits will affect its revenue contribution to the national and regional exchequers. EABL similarly insisted that the increased tax on alcoholic products will drive consumers towards illicit alcohol.

“Sound tax policy must be fair and sensitive to the effects of losing consumers to illicit alcohol, which is neither safe for consumption nor do they contribute to the economy in form of taxes,” EABL’s local subsidiary Kenya Breweries Limited Managing Director, Jane Karuku said.

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