What Exactly The Lifting Of Suspension On Finance Act 2023 Means For Your Pocket Read Now
Comment 0

What Exactly The Lifting Of Suspension On Finance Act 2023 Means For Your Pocket Read Now

The Court of Appeal on Friday temporarily lifted conservatory orders barring the implementation of the controversial Finance Act 2023.

The ruling now sets the stage for the government to implement critical taxes which have been put on hold, following the suspension of the Bill late last month.

The following are some of the immediate consequences to Kenyans after the Court of Appeal judgement.

1. The 1.5 per cent Housing Levy is now applicable unless there is an appeal and stay order at the Supreme Court. 

2.      High-income earners of more than Ksh.500,000 a month will be charged tax at 32.5 per cent for monies up to Ksh.800,000.

Those above Ksh.800,000 will be charged 35 per cent on the extra cash. Previously the maximum tax on salary was 30 per cent.

3. The court ruling also sets the energy and petroleum regulatory authority free to impose the VAT Charge of 16% on fuel.

Despite the previous stoppage, EPRA had already imposed the levy meaning a litre of petrol will continue retailing at Ksh.194 in Nairobi until the next review mid-next month. 

4. The turnover tax now moves to 3 per cent from the previous 1 per cent. This will be charged to all businesses earning between Ksh.1 million and Ksh.25 million per year. The previous upper limit was Ksh.50 million.

Digital content creators will also be charged a withholding tax of 5 per cent.

5. The government had planned to collect Ksh.311 billion through the Finance Act of 2023 which introduced new taxes and higher levies for existing ones.

Some of that may have been missed in the 27 days before the lifting of the conservatory orders. Employees who had already been paid their July salaries they may be required to pay back the housing levy and any extra taxes in subsequent months.

Employers are required to remit tax deductions on the 9th of the subsequent month.

Print Friendly, PDF & Email

Leave a Reply

Your email address will not be published. Required fields are marked *