18/06/2024
The Final Deliberations on the Finance Bill are briefed as follows :
1. 16 per cent VAT on bread removed.
2. VAT on the transportation of sugar removed.
3. VAT on financial services and foreign exchange transactions removed.
4. No increase in mobile money transfers.
5. 2.5 per cent Motor Vehicle Tax removed.
6. Excise duty on vegetable oil removed.
7. Levies on the Housing Fund and Social Health Insurance will become income tax deductible. This means the levies will not attract income tax, putting much more money in the pockets of employees.
8. 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.
9. Consequently, locally manufactured products, including sanitary towels, diapers, phones, computers, tyres and motorcycles, will not attract the Eco Levy.
10. The threshold for VAT registration has been increased from KSh5 million to KSh8 million. This therefore means that many small businesses will no longer need to register for VAT.
11. Responsibility for electronic invoicing ETIMS, recently introduced by KRA, has been receded from farmers and small businesses with a turnover of below Ksh. 1 million.
12. Excise duty imposed on imported table eggs, onions and
potatoes to protect local farmers.
13. Excise duty on alcoholic beverages will now be taxed on the basis of alcohol content and not volume. The higher the alcohol
content the more excise duty it will attract. Consequently, alcohol
manufacturers are expected to make safer and cheaper alcohol.
