Analysts said earlier that economic pressure on the Treasury had prompted the Tax Laws (Amendment) Bill, 2024, and the Tax Procedures (Amendment) (No.2) Bill, 2024. The law has also restored import duty on certain raw materials to cushion local steel manufacturers from cheap imports and create local jobs for at least two years concerning specified items. The amendments also seek to provide clarity and simplify compliance for small businesses and small-scale farmers.
The Ethics and Anti-Corruption Commission (Amendment) Bill 2024 seeks to effect the recommendations and views of the public submitted by the National Dialogue Committee on governance. It also amends the provisions of the EACC Act prescribing the qualifications for appointment of the chairperson of the commission. The Kenya Revenue Authority (Amendment) Bill 2024 provides for the appointment of deputy commissioners by the Commissioner-General.
The laws on Pay as You Earn (P.A.Y.E) and Corporate Tax seeks to increase them from 25 percent to the normal 30 percent and Value Added Tax (VAT) to 16 from 14 percent. Kenyans have been angered by the new taxes, accusing authorities of forcing them to dig deeper into their pockets, while the government presides over wastage of its revenue through theft and corruption. The passage of the bill and signing into law was crucial for President Uhuru Kenyatta’s government since it authorizes it to collect revenue and spend in the financial year through to the end of June 2019. The bill was passed by parliament on Thursday during an acrimonious session marked by loud protests from lawmakers opposed to a new eight percent value-added tax on all petroleum products. According to the presidency, Kenyan President William Ruto signed a bill raising taxes on a variety of goods into law on Monday, ignoring claims that doing so would put the country’s residents through even more suffering.
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The CBK will also have the power to regulate non-deposit taking credit providers to tame a sector that has been a subject of controversy over exploitation. Most of the amendments made in this act were intended to tighten rules governing data utilisation in financial institutions. “These amendments shall promote financial stability and protect depositors from systemic risks by ensuring banks adhere to adequate core capital requirements,” the National Assembly brief says. According to the government, the amendment incentivises the growth of the local steel and construction industry.
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The Tax Procedures (Amendment) Act 2024 simplifies compliance for small businesses and small-scale farmers by providing for reverse ticketing where the purchaser will be the one to issue a tax invoice for the purpose of ascertaining tax liability. The State argues that two new taxes align the taxation of digital services with international best practice, and the taxation of multinationals with the global practice to prevent tax base erosion, respectively. Additionally, the Tax Procedures (Amendment) Bill clarifies the requirements for electronic tax invoices and introduces simplified compliance processes for small businesses and small-scale farmers. The Kenya Roads Board (Amendment) Bill was also signed into law, which reduces the membership of the board from 13 to nine members.
- The new law also outlines procedures by which decisions made by a county government public service are considered inconsistent with laws, regulations and policies and can be contested by a dissatisfied person.
- The information needed on the invoices include the designation ‘TAX INVOICE’, the name and address, the supplier’s PIN, and purchaser’s details.
- One of the standout provisions is the automatic application of tax reliefs, deductions, and exemptions by employers on behalf of their employees.
- These changes are likely to have a significant impact on the economy of the country, which is already struggling with rising inflation.
- Additionally, the Act introduces the Minimum Top-Up Tax at a minimum effective tax rate of 15 per cent.
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Additionally, the Bill supports local farmers by offering excise duty exemptions for spirits made from agricultural products. The Bill also introduces an economic presence tax for non-residents and a minimum top-up tax for multinational companies, ensuring that global firms contribute fairly to Kenya’s economy. A key provision allows taxpayers to deduct contributions to post-retirement medical funds and the Affordable Housing Levy from their tax liabilities, thus alleviating the burden of double taxation. Among the major pieces of legislation passed is the Tax Laws (Amendment) Bill, which introduces sweeping reforms to the country’s tax regime. At the signing ceremony at the State House, President Tinubu said that the occasion presented a new lease of life to every Nigerian and future generation. The Equalization Fund Appropriation Bill grants statutory sanction for public expenditure for the year ending on 30th June, 2017, to facilitate withdrawal of funds from Equalization Fund in line with Articles 204(3) (a) of the Constitution.
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The move seeks to ease the tax burden on salaried workers and eliminate bureaucratic hurdles that previously led to underutilization of available tax benefits. We are a leading integrated digital content platform providing in-depth business and financial news across Sub-Saharan Africa & the globe. The law will also allow the Treasury Cabinet Secretary to waive penalties exacted on appointed individuals who failed to transfer funds collected in the person was under statutory management or under receivership. This was after an uproar from small businesses which were incapable of complying effectively with the prior directives. The Kenya Bankers Association and other industry players had expressed fear that several banks would be forced to close shop or merge to meet the National Treasury’s requirement of raising the core capital from the current Sh2 billion to Sh10 billion at a go. The KRA (Amendment) Act 2024 provides for the appointment of deputy Commissioners by the Commissioner General.
President Bola Tinubu has assented to the four tax reform bills recently president kenyatta signs tax laws passed by the National Assembly. The new law which will now become operational after being assented by the President establishes a clear disciplinary procedure that effectively protects the rights of public officers as provided in Article 47 of the Constitution and the Fair Administrative Act. The Bill which now becomes law after its signing by the President outlines the procedure in the presentation of privatization proposals to parliament following approval by Cabinet. Present during the brief signing ceremony were National Assembly Majority Leader Aden Duale, National Treasury Cabinet Secretary Ukur Yatani, Solicitor General Ken Ogeto, State House Chief of Staff Nzioka Waita, National Assembly Clerk Michael Sialai and State House Deputy Chief of Staff Njee Muturi.
- Akpabio congratulated members of the National Assembly and other stakeholders who made the passage of the tax bills possible.
- The bill was passed by parliament on Thursday during an acrimonious session marked by loud protests from lawmakers opposed to a new eight percent value-added tax on all petroleum products.
- The passage of the bill and signing into law was crucial for President Uhuru Kenyatta’s government since it authorizes it to collect revenue and spend in the financial year through to the end of June 2019.
- “This provision will ensure that employees receive their full tax benefits without needing to make separate claims, improving compliance and fairness in the tax system,” said Kuria Kimani, the Chairperson of the Departmental Committee on Finance and National Planning, who sponsored the Bill.
- It also amends the provisions of the EACC Act prescribing the qualifications for appointment of the chairperson of the commission.
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Golden Moses is a dedicated journalist with a diploma in journalism, bringing sharp insights and reliable reporting to odrimedia.co.ke. With a passion for uncovering the truth, he delivers timely and engaging news stories that keep readers informed. Additionally, the Act introduces the Minimum Top-Up Tax at a minimum effective tax rate of 15 per cent. However, to recoup some of the revenues lost when the Finance Bill 2024 was withdrawn following the Gen Z protests, Parliament has retained the National Treasury’s proposal of a Significant Economic Presence Tax at an effective rate of six per cent for non-residents.
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In passing the Business Laws (Amendment) Bill 2024, the National Assembly offered a reprieve to small banks by staggering the requirement to raise their core capital to Sh10 billion. The new law will now require banks and mortgage financing institutions to raise their core capital gradually within five years, eventually reaching a minimum of Sh10 billion by 2029. Moreover, the Bill increases penalties for non-compliance, aiming to deter businesses and individuals from bypassing the rules. This bill strengthens the Kenya Revenue Authority (KRA), particularly its collaboration with educational institutions such as the Kenya School of Revenue Administration (KESRA), to improve revenue collection and ensure efficient tax administration. The Bill, introduced by National Assembly Majority Leader Kimani Ichung’wah, seeks to align Kenya’s tax policies with international best practices while providing relief to employees, retirees, and businesses. President Uhuru Kenyatta on Saturday, April 8 at State House, Nairobi, signed five Bills into law, aimed at streamlining service delivery to the public.
