NAIROBI, Kenya, May 9 – The National Assembly Committee on Finance and National Planning Chairperson Kuria Kimani has assured that the Finance Act 2024 will have clear provisions devoid of ambiguity on tax matters.
Speaking during a breakfast engagement with the representatives of the banking sector under the Kenya Bankers Association (KBA), Kimani said that the new act will provide specific monthly dates by which entities should have remitted their tax payments to the Kenya Revenue Authority.
“Hon. Kuria acknowledged that failure by the Finance Act 2023, to provide specific monthly dates by when entities should have remitted their tax payments to the Kenya Revenue Authority, may have resulted in increased cost of tax compliance,” read the statement from the committee.
According to a tax policy consultant for KBA Edna Gitachu, the Finance Act 2023 required entities to pay taxes within 5 working days and resulted in a 1,300 percent increase in the number of tax payments per year, leading to huge costs in tax administration.
“Hon. Members, preliminary analysis in our ongoing Total Tax Contribution Report indicates that the average number of tax payments in 2023 for 16 of our respondents is 775, three times the works average. The same analysis shows that banks spent Kshs. 1.18 million in additional costs for hiring staff for tax compliance in 2023,” she stated.
Furthermore, according to Kimani, the finance act would also align with other laws to address concerns that the newly introduced Housing Levy and the Social Health Insurance Fund, scheduled to be rolled out in July 2024, conflicted with the Employment Law and other laws and had led to the decimation of disposal incomes.
