Allan Olingo
Women in East African countries are facing new tax measures that will affect their daily lives as their parliaments debate and approve budgets for 2024.
From new taxes on sanitary pads, diapers, second-hand clothes and fuel, finance ministries in Kenya, Uganda and Tanzania have proposed new tax measures that will affect the basic cost of goods and services, some of which will hit women hard.
In Kenya, women received temporary reprieve in the amended Finance Bill after parliament removed proposed additional taxes on locally manufactured sanitary pads and diapers. However, for the kenyan women, they will still have to bear with higher costs for imported sanitary pads and diapers, that is majority used by the women given production constraints of the locally manufactured one
This comes even as Tanzania increased taxes on diapers and on second-hand clothes (mitumba), a trade dominated by women.
The changes to Kenya’s Finance Bill came after weeks of pressure from activists and citizens on online platforms calling out the government’s proposals for these taxes, which they argued would push more girls and women out of the affordability of sanitary pads.
“The bill proposes a new eco-tax on sanitary pads, making them even more expensive for millions of women and girls. This move is particularly insensitive given that many already struggle to access affordable menstrual hygiene products,” reads part of a petition against the bill on change.org.
On Tuesday, in a partial victory for women, the Finance Committee of Kenya’s National Assembly bowed to pressure from various stakeholders and dropped a number of controversial clauses in the Finance Bill 2024, including the eco-tax on sanitary pads and nappies.
Kimani Kuria, the committee chairperson, said locally manufactured products will not be subject to the eco-tax as it will only apply to imported finished products.
“Consequently, locally manufactured products including sanitary towels, diapers and others that we had highlighted will not attract the eco-tax. The eco levy will only be chargeable to imported finished products,” Kimani said.
The controversial proposal had sparked an outcry, particularly from women’s groups and activists, who called on the state to address period poverty.
But nominated Senator Gloria Orwoba and period shaming campaigner pushed back against the pressure, pointing out that Parliament was not trying to impose any form of tax on sanitary towels.
“In fact, even the eco-tax that will be imposed on manufacturers will not affect local manufacturers of sanitary towels and nappies,” says Ms Orwoba.
On the contrary, Ms Orwoba says, the Finance Bill proposes to remove a policy that prevents manufacturers of zero-rated products, including sanitary towels, from charging VAT.
Kigumo legislator Joseph Munyoro had condemned the move to charge a levy on diapers saying it would burden women and mostly young mothers.
“What do young mothers do now that you want to impose a levy on diapers? Are you asking them to go back to using napkins?” Munyoro posed.
Tanzania has also proposed to increase the duty on baby diapers from the current 25 percent to 35 percent to encourage local production of the products. It has also reduced the 25 percent tax on raw materials used in the local production of these diapers.
It has also proposed to zero-rate fabrics and garments made from locally grown cotton. It has also reduced taxes on vitenge from 50 percent to 15 percent.
On second-hand clothes, Tanzania is now proposing a 35 percent tax on second-hand clothes, shoes and items. It previously charged 35 percent or $0.4 per kilo, whichever was higher. But it has siince done away with the per kilogramme limit, meaning traders will pay more depending on the volumes they bring in.
It now joins Uganda, which in January increased rates by 3 US cents per kilo from $1.16 to $1.19.
But the commissioner of customs at the Uganda Revenue Authority says they had considered changing the rates earlier in the year, but shelved the idea. We usually review the rates at the beginning of the year but we have shelved the proposal.
However, the Uganda Dealers in Used Clothing and Shoes Association says the new tax change is in place and has already forced some traders out of business.
“We are seeing most of our members dropping out,” said Lydia Ndagire, the association’s vice chairperson.
Kenya has also proposed to further increase the road maintenance levy on petroleum products from Sh18 ($0.14) to Sh25 ($0.19).
“This is expected to further increase the cost of doing business and particularly hurt informal businesses – the majority of which are run by women,” Thomas Kinyonda, an economist at Atlas said.
It has also proposed a 3 per cent export and investment promotion levy on liquid fuel (kerosene) stoves, which is expected to hit women in informal settlements and the low-income group hard.
In 2023, Kenya increased VAT on petroleum from 8 per cent to 16 per cent, which the Kenya Gender Budget Network (KGBN), the National Taxpayers Association and the Collaborative Centre for Gender and Development (CCGD) jointly said “has the greatest negative impact on marginal small and micro enterprises (SMEs) – mostly informal businesses where women are in the majority”.
The 2024 Finance Bill also proposed to increase the excise duty on mobile money transfers to 20 percent. In 2023, this had been increased to 15 percent from 12 percent. At the time, women’s groups said this was likely to create a barrier to accessing financial services, particularly for women SMEs that rely heavily on mobile money services.
However, treasury CS Njuguna Ndung’u dropped the proposed increase and maintained the current 15 percent.
In Uganda, the Ministry of Finance had also proposed in April, through the Excise Duty Amendment Bill, 2024, to increase taxes on its petroleum products to Ush1,550 ($0.42) per litre of petrol and diesel, and a further Ush550 ($0.15) per litre of kerosene, a product largely used by women in the poor and low-income bracket, from Ush200 ($0.05). However, this proposal was dropped by parliament after public outcry.
However, after weeks of protests, Kenya’s President William Ruto said on Wednesday that he would not assent to the new tax proposal and sent the Finance Bill back to parliament. However, the tax proposals remain active (not yet law) as they have already been passed by parliament. It is now expected that in the coming weeks an amendment will be presented to lawmakers to delete the entire tax bill. It will then become null and void.
