Tax Experts Call for Transparency in Government Revenue Disclosure Before Implementing New Tax Changes in 2024 Finance Bill
Tax experts are calling on the government to be transparent about the revenues generated from measures implemented in last year’s Finance Act before making any new changes in the upcoming 2024 bill. The Finance Bill 2024 has proposed several revenue measures that will increase the tax burden on Kenyans, including taxing items that were previously exempt.
According to tax lawyer Alex Kanyi, tax increases should be linked to service provision so that taxpayers can see how their money is being used by the government. He emphasized the importance of disclosing how much taxes have been collected so far and how those funds have been utilized before introducing new taxes to close any existing gaps.
Lydia Ndirangu, the Equity Group company secretary and head of tax, expressed concerns that some provisions in the bill could potentially undo the progress made in the financial sector. She highlighted the impact of introducing VAT on financial transactions, which could lead to a shift back to cash transactions to avoid high transaction costs.
Ndirangu also raised issues regarding the proposed car tax and its potential impact on the insurance sector, particularly on motorists with third party insurance. She suggested that the car tax proposal be suspended to allow for an increase in insurance penetration.
The experts shared their views during a discussion in Nairobi as the Finance Committee prepares for public participation before presenting its report to the National Assembly for debate and potential amendments. The proposed amendments in the 2024 bill include changes to the Income Tax Act, electronic tax administration, and the implementation of accrual accounting in government finances.
The debate surrounding the bill highlights the need for transparency and accountability in tax policies to ensure that taxpayers understand how their money is being used and to prevent unintended consequences on various sectors of the economy.
