BREAD, ECO LEVY OUT! Ruto Makes Massive Changes On Tax Proposals
The Kenya Kwanza Government has withdrawn major tax proposals that have sparked outrage among Kenyans in recent weeks.
The announcement came after President William Ruto held a parliamentary group meeting at State House in Nairobi on Tuesday.
In a press briefing following the PG meeting, the Ruto team stated that the proposals were dropped after a public participation exercise in which Kenyans expressed opposition to them.
“The exercise we did on public participation was not an exercise in futility,” National Assembly Finance Committee Chair Kuria Kimani said.
“We have agreed that we must protect Kenyans from increased cost of living.”
Bread, vehicle, and environmental taxes have all been eliminated.
The excise duty on vegetable oil has also been removed.
The tax on mobile service transfers has been retained at the previous rate of 15%.
The tax on locally manufactured diapers and sanitary pads has also been removed.
“It is crucial to point out that Eco Levy is being levied on imported finished products. Locally manufactured products will, therefore, not attract the Eco Levy. Locally assembly and manufacturing will help boost Kenya’s manufacturing capacity, create jobs and save foreign exchange,” Kuria said.
The VAT registration threshold has been increased from Sh5 million to Sh8 million.
This means that many small businesses will no longer have to register for VAT.
“Responsibility for electronic invoicing ETIMS, recently introduced by KRA, has been receded from farmers and small businesses with a turnover of below Sh. 1 million,” Kuria said.
Excise duty has been imposed on imported table eggs, onions, and potatoes to protect local farmers.
Excise duty on alcoholic beverages will now be calculated based on alcohol content rather than volume.
The higher the alcohol content, the more excise duty it will incur. As a result, alcohol manufacturers are expected to produce safer and cheaper alcohol.
The exemption for pension contributions will be increased from Sh20,000 to Sh30,000 per month.
BREAD, ECO LEVY OUT! Ruto Makes Massive Changes On Tax Proposals
