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Kenya: Budget for 2017/18 — direct taxation

The Budget for 2017/18 was presented to the National Assembly by the cabinet secretary for the National Treasury on 30 March 2017. Some of the proposed measures on direct taxation are summarized below.  

Corporate taxation

  • The fishing sector will be granted a 150% deduction incentive
  • Corporate tax for new motor vehicle assemblers will be reduced from 30% to 15% for the first five years of operation
  • Special economic zone enterprises will be granted a 100% investment deduction for buildings and machinery
  • Donations for alleviation of distress during national disasters will be deductible
  • Incentives for development of low-cost housing will be introduced

Personal taxation

  • The tax bands for personal income tax bands will be expanded by 10%
  • Personal relief will be increased by 10%

Withholding taxes

  • Dividends paid by special economic zone enterprises to nonresidents will be exempt from withholding tax
  • Withholding tax on interest payable by special economic zone enterprises to nonresidents will be reduced to 5%

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