The government has removed several contentious ideas from the Finance Bill 2024, scheduled to be introduced in the National Assembly on Tuesday afternoon.
The proposal to levy a 16 percent Value-Added Tax on bread, financial services, and foreign exchange transactions is at the top of the list of ideas that have been canceled due to strong public criticism.
The statement came after a meeting of members of parliament from the ruling Kenya Kwanza coalition, chaired by President William Ruto, at State House in Nairobi.
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Below is a list of the some of the modifications made to the Finance Bill 2024:
1. The proposed 16 percent tax on bread has been removed.
2. The excise charge on vegetable oil has been removed.
3. Transferring mobile services is a major issue for many Kenyans; hence, mobile phone transfer transactions have not grown. The status quo persists.
4. We advocated making statutory deductions such as the Housing Levy and SHIF tax deductible, allowing what is due to PAYE to be less than previously, resulting in more discretionary income.
5. The eco levy will only apply to imported completed goods. All domestically made commodities, including diapers and sanitary towels, will not be subject to the eco levy.
6. VAT Threshold: It has been increased from Ksh.5 million to Ksh.8 million; hence, SMEs with sales less than Ksh.8 million are exempt from VAT registration.
7. eTIMS - Small enterprises with a turnover of less than Ksh.1 million should be excluded from eTIMS.
8. Eggs, onions, and potatoes - suggested excise levy exclusively on imported eggs, onions, and potatoes, making locally produced products more marketable.
9. To fight illegal brews, shift excise duty from volume to alcohol content so those manufacturing high-alcohol content products will pay extra excise duty.
10. increase the monthly taxable contribution limit from Ksh.20,000 to Ksh.30,000 to encourage pension contributions.
11. JSS funds will be used to recruit all 46,000 intern teachers on permanent and pensionable conditions. In addition, an additional 20,000 recruits will be sought.
