Kenyans could be spared several proposed taxes after the National Assembly's Finance Committee recommended major changes to the Finance Bill 2026 in response to public opposition.
In a report presented to Parliament on Tuesday, June 16, the committee proposed deleting a provision that sought to impose a 25 per cent excise duty on every mobile phone activated in the country.
According to the committee, the tax would have posed compliance difficulties, slowed revenue collection, and created uncertainty among consumers, prompting lawmakers to recommend that it be dropped.
The committee also sought to shield businesses by retaining the zero-rated VAT status of several products that the Finance Bill had proposed to reclassify as exempt.
The affected products include locally assembled electric motorcycles and buses, solar and lithium-ion batteries, transportation of sugarcane to processing factories, and raw materials used in the production of animal feeds.
Lawmakers warned that removing the tax incentives would raise production expenses, deter investment, and weaken efforts aimed at promoting local manufacturing.
In addition, the committee dismissed a proposal that would have empowered the Kenya Revenue Authority (KRA) to issue tax notices to taxpayers even when appeals or court proceedings were still underway.
Members argued that such a measure could infringe on taxpayers' rights, interfere with business activities, and limit access to justice.
The committee further opposed plans to include weekends and public holidays when calculating deadlines for lodging tax objections and appeals, saying the proposal would go against principles of fairness and due process.
While recommending the removal of several contentious tax measures, the committee endorsed a number of revenue-raising proposals contained in the Bill.
Among the approved measures is the revival of a tax amnesty programme from July 1, 2026, allowing taxpayers to clear outstanding principal tax obligations accumulated up to December 31, 2025.
Lawmakers cited the performance of an earlier amnesty programme, noting that it attracted more than one million applications and generated billions of shillings in revenue.
The committee also backed revisions to tax return filing timelines after proposals were made to reduce the filing period from six months to four months.
Other measures that received support include taxation of non-resident landlords, exempting death benefits paid to pension beneficiaries from tax, and introducing a 1.5 per cent withholding tax in the scrap metal industry to formalise tax collection within the sector.
