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East Africa Tax Alerts

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We strive to keep you updated on tax developments in the East Africa Region. Our Tax Alerts contain detailed analysis of recent tax measures and their implications on businesses operating in the region.

Recent alerts and an archive of alerts from the previous 12 months appear below; for older issues, please email a request to tax@deloitte.co.ke

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Recent Alerts

Tanzania Tax Alerts - Amendment to the mobile transfer and withdrawal levy

Following our Finance Act, 2021 (“the Act”) Alert published on August 20,2021, this update sets out a high level summary of the amendments madeto the National Payment Systems (Electronic Mobile Money Transfer andWithdrawal Transactions Levy) Regulations, 2021 (“the Regulations”). Read the full analysis here.

Kenya Tax Alert - Revocation of stay of application on CET footwear

The East African Community Council of Ministers (‘Council’) has revoked the stay of application of the East African Community Common External Tariff (CET) rates on footwear that was granted to Kenya under Legal Notice No EAC/118/2021 vide EAC Gazette Vol. AT 1 No 14 of 30 June 2021. The revocation was communicated through EAC Gazette Vol. AT 1 No. 21 dated 27 August 2021 and will take effect on the date of publication. Read more..

Tanzania Tax Alert - Finance Act Alert

This update sets out a high level summary of the changes and clarifications contained in the Finance Act, 2021 (“the Act”), which may have not been included in the Budget Speech read by the Minister for Finance and Planning (the Minister) and in the Bill. Read it here.

 

KRA issues extension of time to comply with the Value Added Tax (Electronic Tax Invoice) Regulations, 2020

On 9 July 2021, the Kenya Revenue Authority issued a public notice announcing an extension of time to comply with the Value Added Tax (Electronic Tax Invoice) Regulations, 2020.

Below, please find the public notice or access it via the KRA web site.

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Extension of Time to Comply with the Value Added Tax (Electronic Tax Invoice) Regulations, 2020

The Value Added Tax (Electronic Tax Invoice) Regulations, 2020 were gazetted on 25th September 2020 vide Legal Notice No. 189 of 2020. The regulations are
aimed at facilitating administration of VAT through Electronic Tax Invoice
Management.

Kenya Revenue Authority (KRA) wishes to inform the public that the roll out of the Electronic Tax Invoice pursuant to the provisions of the Value Added Tax
(Electronic Tax Invoice) Regulations, 2020 shall commence on 1st August 2021.

All VAT registered taxpayers shall thereafter be required to comply with the
requirements of the regulations on implementation of the Electronic Tax Invoice
within a period of twelve (12) months from the date of the roll out.

Where a person is unable to comply within the timelines, they shall apply to the
Commissioner Domestic Taxes for extension of time to comply which shall not
exceed six months as provided for in the regulations. The application for
extension shall be made at least thirty (30) days before the expiry of the
twelve-month period specified.

KRA invites VAT registered taxpayers and suppliers of Electronic Tax Register (ETR) to contact us via: timsupport@kra.go.ke for further guidance.

For other general inquiries and support please call our Contact Centre on Tel: (0) 20 4999 999, 0711 099 999 or Email: callcentre@kra.go.ke. www.kra.go.ke

Uganda Tax alert - Changes in tax payment process

Uganda Revenue Authority (“URA”) has issued a Public Notice prescribing changes in the taxpayment process. Read about these changes here.

Kenya Tax Alert - EAC Gazette

The East African Community Council of Ministers (‘Council’) in its pre budget meetings held in May 2021 approved several measures on customs duty rates and remission of duty on inputs imported for manufacture of goods. The changes were adopted by the Sectoral Council on Trade, Industry, Finance and Investment (SCTIFI) and published in the EAC Gazette Notice dated 30 June 2021. Read more here.

Kenya Tax Alert - The Finance Act, 2021: Tracking the changes

The President signed the Finance Act, 2021 (“the Act”) into law on 29 June 2021. The Act has introduced amendments to the various tax statutes in Kenya, the Capital Markets Act, the Insurance Act, the Retirement Benefits Act, 1997, and the Central Depositories Act. Amendments introduced by the Act largely mirror those under the Bill. However, there are some notable changes in the Act that we wish to bring to your attention. Find our full analysis here.

Tanzania Tax Alert - Finance Bill Alert 2021

The budget speech read by the minister of finance and planning on 10 June 2021 set out the proposed tax changes. Following the release of the Finance Bill 2021 (''the Bill''), this update sets out a high level summary of the changes and clarifications contained in the Bill, which when ratified will become law effectively from 1 July 2021. Read it here..

Kenya Tax Alert - Finance Bill, 2021

The Finance Bill, 2021 was published on 5 May 2021 and tabled in Parliament on 11 May 2021. Based on the Public Finance Management Act, 2012, the Bill should be assented into law by the end of June 2021. This publication summarizes our analysis of the amendments proposed by the Bill and their impact. Find it here.

Tax Alert - Tax Appeals Tribunal Ruling

In a ruling delivered on 13 May 2021, the TAT held that taxpayers must lodge an application for tax overpaid with the Commissioner before utilizing it to offset tax due. Read our analysis here..

Tax Alert - Commissioner revokes restriction of bonded warehousing

On 15 April 2021, the Commissioner of Customs and Border Control (“Commissioner”) revoked Gazette Notice No. 3530 of 2020, which had prohibited bonded warehousing of certain goods, vide Gazette Notice No. 3738 of 2021. Read our analysis of the change and the anticipated implications here.

Deloitte Uganda Tax Alert - Tax Laws Amendment Bill 2020 (April 2021)

This publication constitutes only a brief guide and is not intended to be acomprehensive summary of the tax law and practice. The publicationsummarizes our analysis of the proposed amendments bills and their impacton various articles. Read it here..

Tax Alert - Tax Appeal Tribunal ruling on WHT on professional fees under the Kenya-South Africa DTA

The Tax Appeals Tribunal (“TAT”) has pronounced judgement on the applicability of withholding tax (“WHT”) on professional fees under the Kenya-South Africa Double Taxation Agreement (“the DTA”), in a case pitting McKinsey and Company Inc. Africa Proprietary Ltd (“McKinsey” or “the Appellant”) against the Kenya Revenue Authority (“KRA” or “the Respondent”). Read more...

Deloitte Uganda Tax Alert: Uganda DRAFT Tax Amendment Bills 2021 - 2022

The DRAFT Amendment Bills which proposes changes to the Income Tax Act, The Value Added Tax, The Tax Procedure Code Act among others arecurrently before Parliament for debate. Read our analysis here..

Deloitte Uganda Tax Alert : Application for
withholding tax and withholding VAT exemption – 2021/2022

Uganda Revenue Authority (“URA”) has issued a Public Notice prescribing changes in the process of application for exemption from withholding tax (“WHT”) and withholding VAT (“WVAT”) effective 9 March 2021. This communication highlights the changes and related potential implications to taxpayers. Read more..

Rwanda - General rules on transfer pricing 2020

The Rwanda government published a ministerial Order number 003/20/10/TC of 11/12/2020 establishing the general rules on transfer pricing (TP) between related parties involved in controlled transactions (related party transactions). The rules came into effect on 14 December 2020.

This tax alert summarises the key components of the rules that companies should consider in respect to related party transactions. Read our analysis here.

Deloitte Tax alert - Six months objection settlement deadline

The Finance Act, 2020 that became effective on 1 July 2020 made some crucial amendments to the Tax Administration Act, Cap 438 [RE 2019] (“TAA”). The amendments dealt with the tax dispute resolution mechanism in Tanzania, specifically the resolution of objections filed with the TRA.

This communication highlights the key issues resulting from these amendments and related potential implications to taxpayers. Read more here....

Kenya Tax Alert - The Income Tax (Digital Service Tax) Regulations 2020

The Government of Kenya (GoK) introduced the Digital Service Tax (DST) with effect from 1 January 2021 vide the Finance Act 2020. The Cabinet Secretary for National Treasury and Planning (“the CS”) issued the Draft Income Tax (Digital Service Tax) Regulations, 2020 in August 2020 and invited the public to submit their views on the draft regulations. Following the submissions of the views by the members of the public, the CS has now published, vide Legal Notice No 207, the Income Tax (Digital Service Tax) Regulations, 2020 (“the Regulations”).

In this alert, we summarise the Regulations and provide our point of view on the key provisions. Please access our analysis here

Kenya Tax Alert: The Tax Laws (Amendment) (No. 2) Bill, 2020

In April 2020, the Government of Kenya introduced measures that were aimed at cushioning individuals and businesses from the impact of Covid-19. Some measures comprised of lowering of the income tax and Value Added Tax (VAT) rates. In The Tax Laws (Amendment) (No. 2) Bill, 2020 alert, we highlight the proposed amendments and their impact. Please click here to read our analysis.

Tax Alert: Court of Appeal ruling on payments to card companies and interchange fees

The Court of Appeal (“COA”) has pronounced judgement on the applicability of
withholding income tax (“WHT”) in a matter pitting Absa Bank Kenya Plc
(formerly Barclays Bank of Kenya) (“the Bank”) against the Kenya Revenue
Authority (“KRA”) through the Commissioner of Domestic Taxes (“the
Commissioner”). Read more here....

EAC Tax Alert: Preferential tariff treatment extension

The East African Community Council of Ministers has granted the Republics of Burundi, Rwanda, Uganda, and Kenya a stay of application of the East African Community Common External Tariff (EAC CET) on originating goods imported from the Common Market for Eastern and Southern Africa (COMESA), from 1 January 2020 to 30 June 2021. Similarly, the Council has granted Tanzania a stay of application of the EAC CET on originating goods imported from the Southern African Development Community (SADC) from 1 January 2020 to 30 June 2021. Read more here....

The East African Community (EAC) Gazette 2020

The East African Community Council of Ministers (‘Council’) has considered and adopted Partner States budget proposals for the financial year 2020/21. The approved measures include stays of application of the Common External Tariff (CET), remission of duty on industrial inputs and amendment of the exemption regime under the Fifth Schedule of the EACCMA. During a meeting held on 31 May 2020, the Sectoral Council on Trade, Industry, Finance and Investment (SCTIFI) adopted these changes which were subsequently published in the EAC Gazette Notice dated 30 June 2020. Read more here....

Kenya Tax Alert - Finance Act, 2020

The President assented the Finance Act, 2020 (“the Act”) into law on 30th June 2020. The Act, which was published in Vol. CXXII – No. 133 of the Kenya Gazette of 10th July 2020, seeks to amend various laws relating to taxes and duties and for matters incidental thereto. Read more..........

Kenya Tax Alert: Kenya introduces a voluntary tax disclosure Programme

The Finance Act 2020 (“the Act”) was signed into law on 29 June 2020. The Act introduced a raft of key tax measures among them the Voluntary Tax Disclosure Programme (“VTDP” or “the Programme”). The VTDP, a tax amnesty programme, will run for a period of three years effective 1 January 2021. Read more here.....

Kenya Tax Alert: Finance Bill 2020

On 5 May 2020, the Finance Bill, 2020 was published by the Government of
Kenya. The Bill was tabled in the National Assembly on 6 May 2020 and is
expected to be passed by the end of June 2020. The Bill proposes to amend a
number of different statutes. Read our alert for an analysis of the amendments
proposed by the Bill and their impact as well as related potential implications
to taxpayers.

Tanzania Tax Alert: Remission of Interest and Penalties

On 8 May 2020, the Minister of Finance and Planning published a notice in the government gazette on the coming into force of the new regulations, the Tax Administration (Remission of Interests and Penalties) Regulations, 2020. The Regulations clarify the procedures and eligibility of remission of assessed interest and penalties that may be imposed under Tanzanian tax laws. Read our alert for the highlights of the key issues in the new regulations and related potential implications to taxpayers. Read More....

Uganda Tax Alert: Tax Law Amendment Act 2020

The Income Tax (Amendment) Bill, The Value Added Tax (Amendment) Bill and The Excise Duty (Amendment) Bill 2020 were published on 30 March 2020. The Bills do not include the interim administration tax measures announced by the Uganda Revenue Authority (URA) towards the end of March 2020 aimed at encouraging compliance among taxpayers in light of the COVID-19 situation.

The Bill is currently before Parliament and, subject to any changes that may be passed, will take effect after assent by the President on 1 July 2020.

This publication summarizes our analysis of the proposed amendments and their impact. Read more here....

Kenya Tax Alert: Tax Law Amendment Act 2020

The President assented to the Tax Laws (Amendment) Bill, 2020 on 25 April 2020 thus giving it the force of law. The Tax Laws (Amendment) Act, 2020 has introduced amendments to the Income Tax Act, Value Added Tax Act, 2013, Excise Duty Act, 2015, Tax Procedures Act, 2015, Miscellaneous Fees and Levies Act, 2016, Kenya Revenue Authority Act, 1995 and the Retirement Benefits Act, 1997.

Please read through the tax alert for a high-level summary of the amendments introduced by the Act here......

Kenya Tax Alert: Kenyan Government response to COVID-19

The President of the Republic of Kenya delivered a speech on 25 March 2020,
outlining a number of measures aimed at cushioning Kenyans against the economic effects of COVID-19 pandemic. This announcement has come along with other actions across the globe, as respective governments have come up with various fiscal and monetary measures to mitigate the impact on households and businesses. Read the alert to view the key changes here…

Tax Laws Amendment Bill 2020

The Tax Laws (Amendment) Bill, 2020 was published on 30 March 2020. The Bill has proposed amendments to the Income Tax Act, Value Added Tax Act, 2013, Excise Duty Act, 2015, Tax Procedures Act, 2015, Miscellaneous Fees and Levies Act, 2016 and the Kenya Revenue Authority Act, 1995. Read the alert to view the key changes here....

Kenya Finance Act 2019 Insights: Unravelling the puzzle

Following the assent of the Finance Bill, 2019 into law by the President on 7 November 2019, this publication sets out a high-level summary of the changes and clarifications contained in the Finance Act 2019. Read more....

Keeping you in the loop: Tanzania Court of Appeal’s decision on waiver of objection deposits

The Court of Appeal of Tanzania issued a ruling regarding an Appeal on the Commissioner General’s decision on waiver of objection deposits on 31 May 2019. We have prepared this alert to give you a summary of the ruling and its potential implications for your business. Read more....

High Court yet again, rules in favour of the taxpayer on the VAT treatment of internationally traded services

The High Court of Kenya, at Nairobi, in its decision in Panalpina Airflo Limited vs Commissioner of Domestic Taxes (Income Tax Appeal No. 5 of 2018) has upheld the application of destination principle in determining the country with taxing rights over internationally traded services. In doing so, the Court held that the Appellant’s services were exported and therefore zero-rated for VAT. The Court further held that the Appellant was entitled to the refund of any excess input tax arising from the provision of the impugned services. Read more......

KRA issues update on VAT Auto Assessments (VAA)

The VAT Auto Assessment (VAA) tool was rolled out in October 2018 and piloted on the January 2018 VAT return. The tool was aimed at cross-validating input tax claimed as credit by purchasers against corresponding output tax declared by sellers.  Read more....

Gazettement of Tax Appeals Tribunal members; Introduction of Tax Invoice Management System & Housing Fund levy update

In accordance with the Tax Appeals Tribunal (TAT) Act, new members have been appointed to the TAT by the Cabinet Secretary for the National Treasury and Planning for a period of 3 years through a Gazette Notice published on 15 April 2019.  Read more....

Mauritius Double Taxation Agreement (DTA) Ruling and Housing Levy Update

The High Court of Kenya, Constitutional, Judicial Review and Human Rights Division, sitting in Nairobi, on 15 March 2019 delivered judgement declaring that Legal Notice No. 59 of 2014, gazetting the Kenya – Mauritius DTA, was not properly laid out... Read more....

Requirement for HR Professionals to attach a Clearance Certificate from the Institute of Human Resource Management to Work Permit Applications

The Department of Immigration Services is in the process of implementing a directive, requiring work permit applications under the Human Resource field to be accompanied by a clearance certificate from the Institute of Human Resource Management. Read more....

Deloitte Africa Tax & Legal Appeal Court ruling on withholding tax

The Kenyan Court of Appeal delivered a judgement on 5 February 2019 to the effect that an accrual (of an expense) in the books of accounts falls within the meaning of the word “paid” for Income Tax purposes and therefore withholding tax becomes due upon such accrual. Read more....

Tax Alert - Appeal Court ruling on withholding tax

The Kenyan Court of Appeal delivered a judgement on 5 February 2019 to the effect that an accrual (of an expense) in the books of accounts falls within the meaning of the word “paid” for Income Tax purposes and therefore withholding tax becomes due upon such accrual. Read more....

Tanzania’s amended Value Added Tax Regulations

The Value Added Tax (General) (Amendment) regulations, 2018 effected on 19th Oct have implications for financial services as well as touching upon other industries. Issues addressed include deferment of capital goods, apportionment of input tax among other prescribed requirements. Read more....

Tanzania’s new Transfer Pricing Regulations

The Tanzanian Tax Administration (Transfer Pricing) Regulations, 2018 (“TP Regulations 2018”) are now in force, repealing the previous regulations that have been operational since February 2014. The new regulations require more detailed documentation and supporting information and impose stricter penalties for non-compliance. Read more...

High Court declares VAT not applicable on sale or purchase of land irrespective of the nature of buildings situated thereon

The High Court of Kenya, Commercial & Admiralty Division, sitting in Nairobi, on 29 November 2018 delivered judgement declaring that Value Added Tax (VAT) is not applicable on transactions for the sale or purchase of land. The Court further noted that for VAT purposes, it is immaterial whether the buildings situated on the land are residential or commercial. Read more...

Kenya Revenue Authority seeks to introduce a requirement for oil marketers to issue ETR compliant invoices  - 9 November 2018

In a stakeholder seminar held by the KRA on 25 October, 2018 for the Petroleum and LPG sector, the revenue authority indicated that it is expected of oil marketers to issue Electronic Tax Register (ETR) or Electronic Signature Device (ESD) compliant tax invoices to all buyers. Read more

KRA comes up with new measures aimed at improving Value Added Tax compliance - 1 November 2018

The Kenya Revenue Authority has commenced implementation of an online tool that will generate automated VAT assessments through the iTax platform. In this alert, we discuss the key features of this tool and highlight our view on this initiative. Read more

Changes in the work permit application process - 28 August 2018

Following the administrative and policy changes recommended last month, the Government of Kenya has directed that all foreigners wishing to work in Kenya should have a work permit approved and issued before they can travel to take up their assignment in the country.. Read more

KRA indefinitely postpones implementation of EGMS on bottled water and juice - 10 August 2018 

Following extensive consultations between the Kenya Revenue Authority (“KRA”) and various stakeholders in the water and juice industry, the KRA, through a joint statement dated 31 July 2018, postponed the implementation of the Excisable Goods Management System (“EGMS”) on bottled water and juices that was to commence on 1 August 2018. Read more  

Administrative and policy changes in the management of Work Permits regime - 2 August 2018

The Government of Kenya, through the Cabinet Secretary, Ministry of Interior and Coordination of National Government, has issued a report on the just-concluded Work Permit verification exercise recently carried out during the period from 21 May to 22 July 2018. Out of this, the government issued its recommendations for administrative and policy changes in relation to the management of Work permits. Read more

 

High Court temporarily suspends the implementation of “Robin Hood Tax” - 30 July 2018

The High Court on 19 July 2018 issued conservatory orders suspending the implementation of excise duty introduced by the Finance Bill 2018 in Paragraph 6 of Part II of the First Schedule of the Excise Duty Act, 2015 (“EDA”).  Read more

 

Commissioner General adjusts specific excise duty rates for inflation - 20 July 2018

The Commissioner-General (“CG”) of the Kenya Revenue Authority (“KRA”) has vided Gazette Notice No 164 of 2018 adjusted specific excise duty rates for inflation on certain excisable goods in accordance with Section 10 of the Excise Duty Act. The new rates will take effect on 1 August 2018. Read more

 

The Tax Laws (Amendment) Bill, 2018 - 25 April 2018

The Tax Laws (Amendment) Bill (2018) (“the Bill”) was gazetted on the 10 April 2018. In this alert, we provide you with an analysis of the proposals in the bill, the affected products and our view on the proposed changes and the possible impact of the legislation. 

 

High Court Nullifies EGMS Regulation - 18 April 2018

The High Court on 12 March 2018 made a ruling invalidating the Excisable Goods Management System (EGMS) Regulations introduced vide Legal Notice 53 of 2017 on the premise that they were enacted in a manner that did not conform to the Constitution and the Statutory Instruments Act. This alert explores the case and the ruling made. 

The Finance Act 2017

The Finance Act 2017 was assented into law by the President on 21 June 2017.

The analysis captures salient changes that have been effected to the Income Tax Act, 2015, the Tax Procedures Act, 2015, the Value Added Tax Act, 2013 and the Excise Duty Act, 2015 following the enactment of the Finance Bill, 2017. The analysis only reflects changes not originally contained in the Finance Bill and changes to some of the provisions of the Bill. 

 

The East Africa Community Gazette Notice 2017 – 16 August 2017

The East Africa Community Council of Ministers (‘Council’) reviewed the East Africa Community Customs Management Act (EAC CMA) and the East Africa Community Common External Tariff (EAC CET).

 

Tax Amnesty: Remission of interest and penalties

In response to the tax amnesty announced by the Government of Tanzania in the Budget Reading of 2018/19, we have prepared this alert to give you an overview, and responses to frequently asked questions with respect to the provisions under the Tax Administration (Remission of Interest and Penalty) Order, 2018. Read more...

 
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