DISCUSSION TO EXTEND TIME TO APPLY FOR TAX AMNESTY ON PENALTIES & INTERESTS KICKS OFF

Review of the Tax Procedures (Amendment) Bill, 2024: Kenya

On 23^rd August 2024, The Tax Procedures (Amendment) Bill, 2024 was gazetted as Kenya Gazette supplement number 165. This bill, which is sponsored by the Leader of Majority in the National Assembly, has been submitted to the Cabinet Secretary for the National Treasury and Economic Planning for approval before being tabled to parliament.

The principal object of this bill is to amend the Tax Procedure Act to allow more taxpayers to benefit from tax amnesty and for the Government to continue collecting uncollected taxes.

Below are the proposed amendments in the bill:

1. The Bill proposes to amend section 37E of the Tax Procedures Act (which was introduced by the Finance Act No. 4 of 2023) to extend the time and period for applying for tax amnesty on unpaid tax penalties or interests that accrued up to 31^st December 2022 from the already lapsed date of 30^th June 2024 to 30^th June 2025. This is intended to allow more taxpayers who have tax penalties or interests up to 31^st December 2022 to benefit from the tax amnesty.

1. The Bill proposes to introduce section 37F to offer relief to the Commissioner and give him power to abandon collection of tax where there is doubt or difficulties in recovering the tax. The Commissioner must establish either of the following and obtain the Cabinet Secretary’s approval before abandoning any tax:
2. That it may be impossible to recover an unpaid tax;
3. That there is undue difficulty or expense in the recovery of an unpaid tax;
4. That there is hardship or inequity in relation to the recovery of an unpaid tax; or
5. there exist any other reason occasioning inability to recover the unpaid tax.

1. The Bill also proposes to amend section 77 of the Tax Procedures Act by introducing subsection (2) on computation of time with regards to appeals to the tax appeals tribunal, appeals to the High Court and appeals to the Court of appeal so as to exclude Saturdays, Sundays and public holidays. The new proposed subsection states that in computing the period for lodging objections to the Commissioner, under section 51, 52, 53 and 54 of the Tax Procedures Act; Saturday, Sunday or public holidays shall be excluded.

This bill if finally approved and enacted will have a positive impact on matters tax as many taxpayers will benefit from its provisions.

For more information or assistance with tax matters, contact us on info@aowangaadvocates.com or +254794600191

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