Friday, June 21, 2024
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Kenya: Kenyans Stare at Higher Taxes as Govt Eyes Wigs, Crypto, Cell Phones

Nairobi — Kenyans are staring at a higher tax bill in the next financial year if the Finance Bill 2023 that is tabled in Parliament is passed.

For the beauty sector, the Treasury is seeking to introduce a five percent excise duty on the value of wigs, false beards, eyebrows and eyelashes, and artificial nails.

It also seeks to introduce a ten per cent excise duty on imported cellular phones and a 15 per cent excise duty on imported paints, varnishes, and lacquers.

Further, powdered juice will now be taxed at Sh25 per kilogramme while sugar, excluding that imported or locally purchased by a registered pharmaceutical manufacturer, will attract a Sh5 tax per kilogramme.

The proposed new taxes also include a Sh100,000 excise duty per metric tonne of imported fish or 20 per cent of the value, whichever is higher.

The Treasury is also seeking to introduce a Digital Assets Tax targeting anyone who owns a platform or facilitates the exchange or transfer of digital assets.

The exchequer’s list of digital assets includes cryptocurrencies, token codes, non-fungible tokens or any other token of similar nature.

Kenyans dealing in cryptocurrencies will be required to pay a three per cent tax of the amount they earn from selling digital assets under the proposed regulations.

Further, Treasury is proposing that PAYE be graduated to 35 per cent for individuals earning more than Sh500,000 from the current 30 per cent in its efforts to expand the tax base.

It also proposes an amendment to Section 5 of the Income Tax Act to ensure employees’ per diem, known as cash allowances, are duly taxed.

The government has also set its eyes on digital content creators, they will be subjected to a withholding tax of 15 per cent for all content that they monetize.

Further, through an amendment of the Income Tax Act, the Treasury is seeking to revise the band for those eligible for turnover tax changed from Sh1 million to Sh50 million to a band ranging from Sh500,000 to Sh15 million.

In the bill, the National Treasury is seeking to deduct 3 per cent from Kenyans’ basic salary towards the National Housing Development Fund matched by another 3 per cent from the employer.

On a positive end, the National Treasury proposes to do away with the annual inflation adjustment of excise tax by repealing Section 10 of the Excise Duty Act.

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