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Originally published by Capital Business
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business
May 4, 2026
3h ago

Finance Bill 2026 ends KQ tax relief, widens digital tax net

Finance Bill 2026 ends KQ tax relief, widens digital tax net

At the centre of the proposed changes is an amendment to Section 35 of the Income Tax Act that would delete Paragraph 1(lii), ending a withholding tax exemption previously granted to the national carrier on payments to non-resident service providers offering specialised technical..

✨ Key Highlights

Kenya's proposed Finance Bill 2026 is set to end tax relief for Kenya Airways (KQ) and significantly expand the digital tax net.

  • The bill proposes ending the withholding tax exemption for Kenya Airways on payments made to non-resident service providers.
  • Key organizations like Kenya Airways, payment processors, software firms, and banks will be impacted by broader definitions of "management or professional fee" and "royalty."
  • The proposed changes aim to increase government revenue collection across strategic sectors including aviation, fintech, software, and commerce.

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