The Kenya Revenue Authority (KRA) is proposing to eliminate the Ksh5 million annual turnover threshold for Value-Added Tax (VAT) registration, meaning all businesses, including small-scale traders, would be required to charge and remit a 16 per cent VAT.

• The KRA aims to close an estimated 38 per cent VAT collection gap and boost revenue from Ksh653 billion to over Ksh1 trillion.
• This proposed change affects traders of everyday commodities and service providers, potentially leading to price increases for consumers.
• The plan contradicts the Finance Bill 2024, which suggested increasing the VAT threshold to Ksh8 million.