Event report

Finance Act 2023 and its Impacts on Business and Foreign Investors.

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Recap of our breakfast meeting in partnership with PKF Kenya LLP and ENSAfrica(Kenya).

Amid the ongoing legal tussle on the Finance Act 2023, discussions on what its provisions mean to different players in the economy are necessary. The French Chamber of Commerce Kenya is pleased to serve as a platform where such informative and engaging conversations are had. On the 1^st of August, we hosted a breakfast meeting whose agenda was to take a holistic look at the act’s impact on business and foreign investors. Our selective providers PKF Kenya LLP and ENSAfrica (Kenya), experts in matters tax and law respectively, adequately tackled the topic.

James Mulili, Tax director at PKF Taxation Services Limited gave concise break down and relevant examples of what the different sections of the act translate into. The VAT changes brought about by the act have a general effect of increasing revenue collection for the government, serving as an incentive for growth of the manufacturing industry and increasing international competitiveness of the service industry. The 16% VAT on transfer of business as a going concern and insurance claims, for instance, are a move to raise revenue. On the other hand, a reduced rate of 15% on companies assembling motor vehicles locally promotes growth of the manufacturing industry.  Furthermore, the move to zero-rate the supply of electric bicycles and buses is a stride toward e-mobility. The duality of the net result of these on what the tax payer takes home was well elaborated.

While the aforementioned industries are projected to benefit from the changes in the act, Kevin Chege, tax manager at PKF Taxation Services Limited, addressed some changes in the act that dig deeper into the taxpayers’ pockets. He made clarifications on the rate of contribution to the housing levy, VAT on insurance claims as well as withholding tax on repatriated dividends. George Muthee, a partner at ENSAfrica, gave a legal perspective to the discussion. Using case law, he detailed the legalities on the implementation of the act, especially in light of a suspension and subsequent lifting of the conservatory orders.

The event culminated in a Q&A session. Members in attendance got to have their questions answered by speakers with a wealth of knowledge in a way that was tailored to their different businesses. We appreciate Mercure Nairobi Upper Hill for partnering with us to host this event.