Molo Mp Kimani Kuria has announced that the government have removed the 16 percent VAT tax on bread.
Kuria made the announcement as he made a brief to the press after the Kenya Kwanza Parliamentary Group meeting at State House on June 18.
“We have listened to the view Kenyans in the form of public participation and there are two things we must do. 16 percent on vat on bread has been droppe and we have proposed that we do not have any increase on taxation on mobile phone transfer,” Kuria said.
Kuria added that the imposing this on locally manufactured goods, eco levy will only be chargeable to imported finished products.
Here is a list of the changes made to the Finance Bill 2024:
1. The proposed 16 per cent on bread has been dropped.
2. Excise duty on vegetable oil removed.
3. Transfer of mobile services is a key concern for many Kenyans hence no increase on transaction of mobile phone transfer services. The status quo remains.
4. We proposed that statutory deductions such as Housing Levy, SHIF to be tax deductible and hence allow what is subjected to PAYE is an amount less than what was therebefore so more disposable income.
5. Eco levy will only be tangible to imported finished products. All locally manufactured items including diapers and sanitary towels will not be subject to eco-levy.
6. VAT Threshold; increase from Ksh.5 million to Ksh.8 million hence SMEs that have turnover of less than Ksh.8 million don’t have to register for VAT.
7. eTIMS – Small businesses that have turnover of less than Ksh.1 million should be exempted from eTIMS.
8. Eggs, onions, potatoes, – proposed excise duty only on imported eggs, onions and potatoes hence locally produced to be more marketable.
9. Fight against illicit brew – change in excise duty from volume to alcohol content hence those producing very high alcohol content will pay more excise duty.
10. To support pension contributions: Increase amount allowable for Taxable contributions from Ksh.20,000 to Ksh.30,000 monthly.
11. Money allocated for JSS – hire all 46,000 JSS intern teachers for permanent and pensionable terms. In addition to recruit another 20,000.
12. Motor Vehicle Tax – The motor vehicle tax cannot be amended through Income Tax Act. Pegging it on insurance would cripple the insurance business and hence the proposal has been dropped.
13. Sugarcane Transportation: Remove VAT on transportation of sugarcane from farms to the milling factories.
