Kenya proposes increase in capital gains tax for property transfers
September 2019
Overview
Finance Bill 2019, introduced through Kenya Gazette Supplement No.104, proposes to increase the capital gains tax rate from 5% to 12.5%, effective October 1, 2019. Kenya reintroduced its capital gains tax on transfers of property situated in Kenya, effective January 1, 2015, after previously suspending it in 1985. The tax, payable by the transferor, currently is imposed at a 5% rate (final tax) on net gains from such transfers.
The takeaway
Taxpayers may appreciate the ongoing reforms in Kenya, particularly the tax reforms and government efforts to increase internally generated revenue and attract foreign direct investment. However, appropriate guidelines are needed to better implement the reforms and simplify regulations. Multinationals should keep abreast of these and other relevant changes to Kenyan tax law
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