Kenyans Face Higher Taxes As Treasury Proposes 18% VAT Increase

• The National Treasury in Kenya is proposing to increase the value-added tax (VAT) on products and services from 16 percent to 18 percent.
• The Treasury argues that Kenya’s current VAT rate is lower compared to neighboring countries in the East African Community.
• The proposed increase in taxes is aimed at financing President William Ruto’s bottom-up economic agenda to lift more Kenyans out of poverty.
• The government also plans to increase excise duty on spirits and other products with higher alcohol content to discourage consumption.
• The excise duty rate for tobacco products will be harmonized, and taxes on sugar-based non-alcoholic beverages will be reviewed to prevent obesity and diet-related diseases.
• Kenyans are encouraged to submit their recommendations on the proposed tax changes by October 6, 2023.