(Bloomberg) -- Kenya plans a 1.5% digital tax on the value of online transactions, according to proposals in the Finance Bill 2020, cashing in on a nascent industry taking off amid the coronavirus pandemic.
The government in East Africa's biggest economy will also start levying a minimum gross sales tax of 1% and proposes a minimum tax for all companies. The draft measures will be presented to the National Assembly for a first reading on Wednesday.
The minimum tax will require even loss-making firms to remit tax based on their sales, according to Daniel Ngumy, a partner and head of the tax department at Anjarwalla & Khanna, a Nairobi-based law firm.
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Other highlights:
- The Capital Markets Authority will license and regulate private equity and venture capital firms seeking access to public funds such as pensions.
- The bill proposes to establish a three-year voluntary tax disclosure program through which taxpayers can disclose unpaid tax liabilities in exchange for some relief on penalties and interest.
- A 2.5% duty on the customs value for goods manufactured in export-processing zones that are sold in the domestic market.
- The Retirement Benefits Authority will receive powers to penalize pension funds that fail to submit actuarial valuation reports within the specified periods.
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