Summary of 2023 Finance Bill in Kenya

64

Most Kenyans are only focusing on the 3% housing levy in the 2023 Finance bill but there are 17 other contentious issues you need to know. The bill is about to be tabled in parliament to be voted for and before it’s passed, you need to know what to expect.

Below are the 18 contagious issues in the finance bill:

1 .           House levy 3% by employee and employer respectively

 2 .          35% tax rate PAYE above Kshs 500,000 per month from 30%

 3 .          Reintroduction of VAT on exported services

 4 .          Increase in turnover tax from 1% to 3%

 5 .          15% withholding tax on income earned by digital content creators

 6 .          Increase in the VAT rate on Petroleum products from 8% to 16%

 7 .          Deposit 20% of disputed tax amount before lodging an appeal at the High Court

 8 .          Payment of excise duty within 24 hours from closure of transactions if the day betting and gaming

 9 .          Introduce VAT on insurance compensation in relation to assets on which input VAT had been claimed

 10 .        Lowers the businesses that pay corporate tax at 30% from Kshs 50 million turnover to Kshs 15 million turnover

 11 .        Introduction of an export and investment promotion levy on specified imports

 12 .        Increase excise duty on mobile money transfer services from 12% to 15% of the excisable value

 13 .        Introduction of 15% P.A.Y.E tax on first Kshs 24, 000 earned without relief

 14 .        Exempting Liquefied Petroleum Gas (LPG) from VAT

 15 .        Claims of expenditure which is not supported by invoices generated from electronic tax invoice system will not be allowed

 16 .        Introduce 5% excise tax on human hair, false beards, eyebrows, lashes, artificial nails

 17 .        Change taxable band from current (Kshs 1 million to Kshs 50 million) to (Kshs 500,000 to Kshs 15 million) for business entity

 18 .        Mandatory NHIF contribution of a standard rate of 2.75% of the gross monthly salary towards the NHIF cover