NAIROBI, Kenya, Feb 23 – The introduction of excise duty and the use of excise stamps on cigarettes has cut British American Tobacco’s 2016 profit by 15 percent to Sh4.2 billion.
The firm’s taxes increased by Sh3.1 billion compared to the previous year, to hit Sh19 billion.
The introduction of excise duty has also led to an increase in cigarette prices, lowering sales of the firm.
The board has however recommended a Sh39.50 dividend per share.
Last week, the Court of Appeal upheld the country’s 2014 Tobacco Control Regulations, rejecting legal challenges to the regulations from BAT.
The three-judge bench ruled that the regulations are constitutional and do not contradict the Tobacco Control Act as had been argued in suit papers by BAT.
Included in Kenya’s Tobacco Control Regulations are requirements for tobacco companies to pay an annual fee into a designated tobacco control fund to assist the government in paying for the harmful health effects of tobacco use for Kenyans.
The regulations also require picture-based health warnings and strengthened protections against second-hand smoke.