Kenya with not raise VAT despite neighbouring countries

By professo
Share

Kenya has confirmed that it will not be raising its value added tax (VAT) in order to follow the uniform rate used by its neighbouring countries in the East African Community (EAC).

On 3 April, the nation’s Treasury Principal Secretary Kamau Thugge announced that Kenya’s VAT rate would remain at 16%.

The other five members in the trading bloc – Burundi, Rwanda, South Sudan, Tanzania, and Uganda – are currently charging VAT rates of 18%.

There are current concerns that Kenya’s reluctance to uniform its tax could distort the EAC common market.

SEE ALSO:

The Institute of International Finance (IIF) has recommended that Kenya matches its VAT in order to boost revenues and relieve deficits which have caused the country to take out loans.

“Improving the VAT’s collection to five per cent of GDP (gross domestic product) can further cut the deficit by 0.6 per cent of the GDP,” commented IIF.

“Furthermore, the VAT rate could also be raised from the current 16 per cent to 18 per cent, similar to the rates in Uganda and Tanzania.”

However, the news has been well received by household and businesses, which will not be charged extra for commodities.

Share

Featured Articles

SAP creates new EMEA region and announces new President

SAP has announced it has appointed a new President for a newly-created EMEA region, aiming to make the most of the opportunities of cloud and AI technology

How SAP is facilitating continuous business transformation

Technology giant SAP has expanded its portfolio with the acquisition of LeanIX, a leader in enterprise architecture management (EAM) software

Siemens and Microsoft: Driving cross-industry AI adoption

To help businesses achieve increased productivity, Siemens and Microsoft are deepening their partnership by showcasing the benefits of generative AI

Sustainability must become central to corporate strategy

Sustainability

The endless benefits of putting your people first

Leadership & Strategy

Working from anywhere: SAP uncovers secret life of employees

Human Capital