Written By Lisa Murimi
Stakeholders have expressed significant concerns over the proposed Tax Laws and Business Laws (Amendment) Bill, warning of potential economic challenges for Kenyans if it becomes law.
In submissions to the Finance Committee of the National Assembly on Wednesday, November 27, the Institute of Certified Public Accountants of Kenya (ICPAK) criticized the lack of clarity on the effective dates of the proposed taxes.
They emphasized that specifying commencement dates would eliminate confusion for taxpayers and streamline compliance with the Kenya Revenue Authority (KRA).
ICPAK also opposed the proposed hike in excise duty on internet and telephone services from 15% to 20%, arguing it would inflate communication costs and adversely impact businesses and youth-driven content creation industries.
“With dwindling job opportunities, why increase taxes in areas where the youth earn a living?” ICPAK questioned.
The Law Society of Kenya (LSK) highlighted ambiguity in the Bill’s withholding tax clause, which proposes penalties of 10% for non-compliance.
They urged the government to clarify what constitutes “reasonable cause” for failing to remit taxes, cautioning against potential disputes.
Digital traders also raised alarm, warning that the 5%-20% withholding tax on payments to digital marketplace owners could stifle e-commerce growth, undermining revenue collection goals.
The Finance Committee has yet to address these pressing concerns.
