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Kenyans transacting more than half-a-million shillings can now have a reason to smile after Members of Parliament on Thursday turned down a proposal that sought to impose a 0.05 per cent tax.
MPs voted to reject the excise duty tax commonly referred to as the Robin Hood proposed by Treasury Cabinet Secretary Henry Rotich in Finance Bill, 2018.
This means that Kenyans transacting money above Sh500,000 will do so without additional costs, dealing a blow to government's bid to meet its revenue target.
The Robin Hood tax was part of the measures proposed by the Treasury to enable it fund the ambitious Sh3 trillion 2018/19 budget estimates tabled in Parliament on June 4th.
If MPs didn't reject the amendments, a 0.05 per cent tax would be slapped on cash transfers above Sh500,000 either within the same bank or between different lenders.
It would also apply to cash transferred between individuals through cash transfer agencies and other financial service providers.
At the same time, lawmakers rejected Kiambu Town MP Jude Njomo's bid to introduce amendments to the Finance bill to compel banks to reserve at least 10 per cent of their loan portfolio for lending to Small and Medium Enterprises (SMEs).