President Uhuru Kenyatta signed the Tax Amendments and Tea Bill of 2018 into Law. The two new laws will adjust tax to pre-Covid levels and offer relief to tea farmers in the country.
On one hand, the Tax Amendments will bring back Value Added Tax (VAT) to 16% from 14% to increase tax collections, expanding collections by at least Ksh 78 billion between 1 January and June 30 2021.
The Tax Amendments will also raise corporate tax to 30%, up from 25% set to cushion companies from blows of the pandemic, as well as adjust PAYE and Individual income tax to pre-pandemic levels.
On December 22nd, Parliament approved plans to revert to readjust tax relief measures instituted in April 2020 in light of the pandemic, which caused a revenue shortfall of ksh 122 billion…