Application of excise tax to reduce obesity, smoking rates by over quarter in next 5 yrs

ALAFCO gains KD 13.1m in Q3 of current fiscal year

KUWAIT CITY, Aug 6: The application of excise tax will reduce obesity and smoking rates in the country by more than a quarter in the next five years, reports Al-Rai daily quoting official sources from governmental bodies.

Excise tax is one of the indirect taxes borne by the final consumer. This type of tax is imposed on goods deemed harmful to public health and the environment or unnecessary goods like tobacco, energy drinks and soft drinks without any impact on basic commodities.

Sources told the daily that obesity and smoking rates are expected to decline by an average of 10 to 20 percent in 2023 once the excise tax is implemented.

Minister of Finance Dr Nayef AlHajraf had earlier pointed out the health aspect of this tax, affirming that the Ministry of Health is monitoring the negatives effects of consuming the abovementioned items on an individual’s health. He explained the implementation of this tax is not aimed at increasing State revenues as the main objective is to protect public health.

Vice Chairman and Chief Executive Officer of Aviation Lease and Finance Company (ALAFCO) Ahmed Abdullah Al-Zeben said the company gained KD 13.1 million in the third quarter of the current fiscal year which started on Oct 1, 2018; adding that the gain per share is 13.8 fils within the same period.

In a press statement, Al-Zeben disclosed that the operation revenues reached KD 87.2 million in the third quarter of the fiscal year -- six percent increase compared to the same period in the previous fiscal year.

He said the company has requested for 112 aircraft which are new Airbus and Boeing, indicating they will be delivered in the next five years over. He added ALAFCO increased the number of aircraft to 70 and these are chartered to 23 companies in 15 countries.