The Kenya Revenue Authority (KRA) is proposing new regulations allowing it to compel Kenyan banks, payment processors, and customers to withhold and remit taxes on behalf of non-compliant foreign technology companies. These draft Income Tax (Significant Economic Presence) Regulations, 2025, aim to broaden the tax base beyond the lapsed Digital Service Tax.

• Under the proposed rules, about 10% of a foreign firm’s gross turnover from Kenyan users would be considered taxable profit, subject to a 30% corporate income tax, resulting in an effective 3% levy on revenues.
• The KRA plans to target companies like Netflix, Amazon, OpenAI, Airbnb, and Uber, broadening the scope of taxable services to include cloud computing, online education, ride-hailing, and digital asset exchanges.
• This unilateral tax approach by Kenya, while aligning with the global debate under the OECD’s Pillar One framework, risks friction with countries like the U.S. and Europe, which have expressed concerns about such taxes.

Kenya is set to implement new stringent customer service standards for its electricity sector through the Draft Energy (Electricity Reliability, Quality of Supply and Service) Regulations, 2025. These regulations aim to enhance accountability and improve customer experience across all licensees in the power industry.

• Electricity distributors and retailers will be required to publish service charters, reconnection timelines, and detailed complaint-handling procedures for approval by the Energy and Petroleum Regulatory Authority (EPRA) every three years.
• Key service timelines include reconnection within 24 hours after payment, notification of planned outages at least 48 hours in advance, and meter testing results shared within 14 days.
• Utilities must provide 24-hour telephone services for emergencies and complaints, and resolve technical complaints within seven working days and non-technical complaints within 30 working days.

Thirty-five SACCOs face potential sanctions for failing to register with the Financial Reporting Centre (FRC), a requirement under new anti-money laundering regulations. This crackdown is part of Kenya's efforts to address its "grey listing" by the Financial Action Task Force (FATF), aiming to restore international confidence in its financial system.

• 35 SACCOs have not fully registered with the FRC despite compliance being a condition for annual licensing, impacting an industry with KSh 1 trillion in assets and serving 7.4 million members.
• The Sacco Societies Regulatory Authority (SASRA) is spearheading the enforcement and has rolled out new guidelines for combating money laundering and terrorism financing.
• Kenya was placed on the FATF grey list in 2023 due to deficiencies in its anti-money laundering framework, prompting urgent reforms including amendments to the Proceeds of Crime and Anti-Money Laundering Act (POCAMLA).