CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Kenyan Tax Reforms In Medium-Term Budget Plan

Kenyan Tax Reforms In Medium-Term Budget Plan

by Lorys Charalambous,, Cyprus

27 January 2015

Kenya's National Treasury has released a Budget Policy Statement setting out tax reforms plans for the next three years.

The Treasury has proposed measures to simplify compliance with the tax regime, enhance tax administration, and broaden the tax base. The Treasury said that while a "reasonable degree of predictability with respect to the level of tax rates and tax bases" is to be maintained, extra revenues will be needed to fund increased spending on economic development.

Kenya has already taken a number of measures to broaden the tax base, including the enactment of an income tax regime for the mining sector and the re-introduction of capital gains tax with effect from January 2015.

The adoption of new modern tax administration systems is proposed to improve the efficiency of tax collection and cut compliance costs for businesses. These systems will also support tax audit efforts and risk profiling to tackle the informal sector.

The National Treasury will submit to Parliament a Tax Procedure Bill for possible enactment in 2015, along with a new Excise Duty Bill. A review is also to be undertaken of the Income Tax Act, which will be completed by the end of 2015 and submitted to Parliament in early 2016.

The Government also plans to remove "distortionary" tax incentives, thereby expanding the income tax base. Last, the Government has said it will fast-track the creation of Special Economic Zones in Kenya to attract foreign direct investment.

Kenya's overall fiscal balance (after grants) is projected to decline from 8.8 percent of gross domestic product (GDP) in the 2014/15 fiscal year to a more sustainable level of about 4.1 percent of GDP over the medium term. This would include a fall in public debt, from around 43.8 percent of GDP in 2014/15 to about 41.2 percent of GDP by 2017/18.

TAGS: compliance | tax | business | tax compliance | tax incentives | law | tariffs | legislation | Kenya | tax breaks | tax reform | trade | free trade zone | services | Tax

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »