Treasury CS Ukur Yattani Introduces New Tax

Treasury Cabinet Secretary Ukur Yattani has established a new tax that will affect all enterprises, whether they make profit or not.

The CS announced the Minimum Tax speaking at a press conference during the National Taxpayers Day on Thursday 6 November.

The minimum tax rate is 1% of the company’s total turnover. The Government will begin collecting the tax on 1 January 2021.

The tax shall be paid in installments on the 20th day of each term ending on the 4th, 6th, 9th and 12th month of the year of income.

The Kenya Revenue Authority (KRA) clarified that the tax is intended to encourage equality and fairness in the tax system, as everyone pays a simple tax, whether or not they earn profit.

“Where the Instalment Tax payable by a person is higher than the Minimum Tax, then the person shall pay Instalment Tax; however, where the Minimum Tax is higher than the Instalment Tax, then the Minimum Tax shall be payable,” KRA stated.

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