Finance Bill: New tax proposal targets motor vehicle owners
Kenyans will have to tighten their belts even more following the gazettement of the Finance Bill 2024.
The 135 page document has proposed a raft of measures geared towards broadening the tax base and raising the revenue to meet the Governments plans in the next financial year of 2024/2025.
Among the proposed area that has elicited mixed reactions both on and offline is the 16 per cent VAT on bread, with 400g loaf set to rise by at least Ksh10 under the new law.
Treasury has proposed the removal of ordinary bread from the list of zero-rated supplies, a VAT exemption list.
Others who will feel the pinch of the new law are Vehicle owners who will start paying an annual tax of up to Ksh100,000 depending on the value of their cars if Parliament endorses the proposal that is set to increase motoring costs amidst the costly fuel and spare parts.
The Bill proposed the introduction of a 2.5 per cent annual tax on the value of vehicles, with the deduction set at a minimum of Ksh5,000 and a maximum of Ksh100,000.
The deduction, called motor vehicle tax, will be paid on each vehicle at the time of issuing an insurance cover.
