The Finance Bill, 2021 (the Bill) was introduced for first reading in the National Assembly on 5 May 2021. This is consistent with the recent norm where Finance Bills are introduced for debate prior to the reading of the budget in June of each year.
The Bill proposes to amend a number of legislations such as the Income Tax Act, Value Added Tax (VAT) Act, Excise Duty Act, Tax Procedures Act, Miscellaneous Fees and Levies Act, Capital Markets Act, Central Depositories Act, Kenya Revenue Act, Insurance Act and Retirement Benefits Act.
It is interesting to note that some of the proposed amendments appear to be reactions by the Kenya Revenue Authority (KRA) to the recent spate of disputes that it has lost at the Tax Appeals Tribunal and the High Court. One example is the taxation of export of services which has been litigated in a number of cases and is now targeted for amendment to deny taxpayers refund of input VAT.
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