Kenya Japan Tax Exemption: The National Assembly on Wednesday passed a motion that was tabled by the Committee on Delegated Legislation to exempt Japanese companies, employees, and consultants from paying income tax in Kenya.
The committee’s chair William Kamket said that the move will see the groups working on projects agreed upon between the governments of Kenya and Japan exempted from paying tax. He added that the exemption was a conditional requirement for all financing agreements between Japan and any other government.
“The policy and requirement of the government of Japan are to have Japanese companies, consultants and employees involved in the implementation of any project financed by the government of Japan, exempted from tax,” Kamket said Kenya had already agreed on the tax exemption with Japan.
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“Parliament is only ratifying what was already agreed as a condition of being given a grant. The logic is clear, if the Japanese government is to give Kenya a certain amount as a grant or as a concessional loan, you cannot then seek to profit from the same grant by taxing the services that are being provided as part of the operationalisation of that grant by Japanese companies,” he said.
The National Treasury cabinet secretary Ukur Yatani had ssued a legal notice on the tax exemption on February 26. This was later on submitted to the Kamket-led committee for ratification. “Cabinet Secretary for National Treasury and Planning directs that the income which accrued in or was derived from Kenya by Japanese companies, Japanese consultants and Japanese employees involved in the projects…. shall be exempt from income tax….,” he had said.
