Kenya’s proposed Finance Bill 2026 has triggered significant discussion across the accounting, audit, and tax sectors after the National Treasury unveiled wide-ranging amendments targeting income tax, VAT, excise duty, and tax administration. The bill introduces reforms expected to reshape corporate taxation and compliance obligations beginning July 2026.
Among the most notable proposals is the expansion of taxable professional and management fees to include interchange and merchant service fees generated through digital payment systems. Analysts say this reflects the government’s growing focus on taxing the expanding digital economy and financial technology ecosystem.
The Bill also seeks to streamline tax administration by harmonizing definitions across various tax statutes. Tax practitioners argue that these changes are intended to reduce legal loopholes previously exploited during disputes between taxpayers and the Kenya Revenue Authority (KRA).
Audit firms and accounting professionals are now advising businesses to begin early tax impact assessments, particularly firms operating in fintech, importation, logistics, and professional consultancy sectors. Companies are expected to reassess tax planning models, cash flow projections, and compliance systems ahead of implementation.
Experts further warn that the proposals could increase compliance costs for SMEs already struggling with economic pressure, especially where mandatory digital invoicing and stricter expense verification are concerned.
