Breakdown of Contentious Issues in Finance Bill 2023

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President William Ruto on dias, with Chair- Council of Governors Ms Ann Waiguru, during Governor’s Summit. Ruto sought their support on Finance Bill 2023 to help him create jobs

 1. House levy 3% by employee and employer respectively

 2 . 35% tax rate PAHYE 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 which President Ruto dropped after immense pressure from creative industry 

 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

19. All rents payable on any premises/houses to be collected by a govt appointed agents who will remit taxes to the govt within 24 hours of collection

20. Vehicle owners to pay advance taxes of a minimum of 5000 per year or 100 per passenger per month

21. Chamas etc to pay taxes on the contributions to be considered as income.

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