Kenya: Tax authority temporarily restrained from collecting minimum tax

The High Court issued an order that temporarily restrains the Kenya Revenue Authority from enforcing the tax law provision regarding the minimum tax

High Court issued order temporarily restraining tax authority from collecting minimum tax

The High Court issued an order that temporarily restrains the Kenya Revenue Authority from enforcing the tax law provision regarding the minimum tax.

The court’s action effectively bars the tax authority from collecting or demanding minimum tax pending a hearing and final determination of the case.

KPMG observation

The view of some tax professionals is that the court’s order applies to taxpayers that are subject to the minimum tax, given that the order bars the tax authority from demanding and collecting minimum tax from all taxpayers. The Kenya Revenue Authority issued a press release confirming that it will abide by the High Court’s order. 

Pending resolution of the case, taxpayers need to consider whether to remit the minimum tax. If, however, the court issues a final judgment for the tax authority, it could be that the Kenya Revenue Authority would seek to collect minimum tax plus interest and penalties, from 1 January 2021. Thus, taxpayers need to carefully consider their actions.

Read an April 2021 report prepared by the KPMG member firm in Kenya 

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