In a significant move towards transparency and accountability, Members of Parliament could soon wield authority over decisions regarding tax relief.
If the proposed Tax Procedures (Amendment) Bill, 2024, becomes law.
The bill aims to amend the current Tax Procedures Act (Cap 469B), curtailing the discretionary powers of the Treasury Cabinet Secretary.
And the Kenya Revenue Authority (KRA) Commissioner General in granting tax reliefs.
Under the existing framework, individuals or companies can apply to the KRA Commissioner for amnesty from penalties on overdue taxes.
Proposing repayment plans for outstanding amounts. Should recovery seem unlikely, the decision could escalate to the Treasury CS for final approval or denial.
“The Cabinet Secretary may approve relief of part or the whole tax owed by an individual or direct the Commissioner accordingly,” the Bill stipulates.
Notably, the proposed amendment mandates the CS to present all approvals before the National Assembly for final authorization.
Furthermore, details such as the names of beneficiaries, reasons for amnesty, and the amount of waived taxes must be made public.
Kimani Ichung’wah, the National Assembly majority leader and the bill’s proponent, emphasizes its intent to prevent misuse of tax waivers.
“This provision seeks to empower Parliament to oversee the Cabinet Secretary’s discretion in granting reliefs,” he affirms.
Initially shelved in the repealed Finance Bill 2024, the proposal reemerges with support to reinstate progressive tax measures.
Treasury CS John Mbadi, discussing the bill’s potential impact, highlighted the phased reintroduction of pertinent clauses aligned with economic needs.
“This isn’t about urgency but ensuring our tax collection remains robust.
We’ll reintroduce these measures gradually, focusing on sectors where they can spur growth and streamline tax processes,” Mbadi asserted.
As discussions evolve, the bill is a pivotal step towards reinforcing legislative oversight in fiscal matters, promoting fairness and efficacy in tax administration.
