Kenyans have expressed fears over alleged double taxation should the Tax Laws and Tax Procedures Amendment Bills, which are currently undergoing public participation, sail through Parliament.
Speaking during a public participation forum conducted in Nairobi on Monday, November 25, manufacturers expressed concerns about the proposed changes to the Standards Act, which seeks to introduce the registration of manufacturers by the Kenya Bureau of Standards (KEBS).
While making their submissions during a stakeholder meeting with the National Assembly Committee on Trade, the representatives of the manufacturers claimed that the tax proposal introduced a new administrative process that duplicated the role of the Kenya Revenue Authority (KRA).
The stakeholders claimed that most manufacturers were already paying taxes to KRA as per the Excise Duty Act of 2015, and therefore the new Bill which seeks to allow KEBS to regulate the sector, would lead to double taxation.
The Association of Gaming Operators has expressed concerns that the proposed changes to the taxation regime in the sector could negatively impact investment.
They argue that the unpredictability of the tax framework might lead to reduced capital flow into the economy, as multinational betting operators could seek alternative investment destinations.
“We note with concern the constant and dynamic changes that have been made to the taxation regime governing the betting and games sector. The unpredictability of the tax regime on the sector will result in a case where capital will not flow easily to the Kenyan economy as multinational betting operators will look for alternative investment destinations," noted the representatives of the Association of Gaming Operators.
Responding to the concerns, the head of the Committee, Chairperson James Gakuya, assured the manufacturers that the committee would consider their plight when the bill gets back to parliament.
The Bill, sponsored by Majority Leader Kimani Ichung’wah, aims to make several amendments to the country's tax system, including the enhancement of the role of the Kenya Accreditation Service (KAS) in regulating foreign conformity assessment bodies operating in Kenya.
It also proposes an amendment to Section 4 of the Special Economic Zones Act, granting the Cabinet Secretary the authority to determine the minimum acreage required for the designation of Special Economic Zones (EPZ).
However, a section of the stakeholders who appeared before the Committee endorsed some of the tax provisions contained in the bills, terming them progressive.
Okoa Uchumi Campaign, a civil society group, supported the proposed taxation of digital marketplaces, noting that this measure would expand the tax base to include income earned from payments made by digital platform owners, which is consistent with the National Tax Policy, 2024.
The lobby group nonetheless called on the government to focus more on rationalising expenditures and addressing documented waste and corruption rather than placing a focus on revenue-raising measures.
