May 24, 2025

LSK opposes Finance Bill 2025 clause allowing KRA access to personal data

LSK opposes Finance Bill 2025 clause allowing KRA access to personal data

LSK opposes Finance Bill 2025 clause allowing KRA access to personal data

The Law Society of Kenya (LSK) and audit firm KPMG East Africa are among entities that have opposed a clause in the Finance Bill 2025, which seeks to grant the Kenya Revenue Authority automatic access to trade secrets and personal data. 

In a separate objection, Ernst & Young Public Accountants and CDH Law Firm rejected another proposal in the same bill, one that seeks to hold the spouses of tax defaulters personally liable for outstanding obligations.

A controversial provision in the Finance Bill 2025 seeking to compel the spouse of a tax defaulter to shoulder tax liability has been unanimously rejected by entities presenting their memoranda to the National Assembly’s Finance and Planning Committee.

The Law Society of Kenya, audit firm KPMG East Africa, Ernst & Young, and CDH Law Firm opposed the clause, arguing that it undermines individual financial autonomy and accountability.

“Someone seeking credit facilitation and defaults is a personal venture,” the legal body said. 

Subsequently, the Law Society of Kenya and audit firm KPMG East Africa also opposed a separate provision in the bill that would allow the Commissioner to automatically access trade secrets and personal data, and to issue agency notices even when a taxpayer has lodged an appeal against a decision by the Tax Appeals Tribunal or the courts.

The two entities argued that granting such powers would significantly undermine taxpayers’ rights to due process and fair adjudication.

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Clause 50b of the Finance Bill 2025, which seeks to extend the timelines for processing tax overpayment claims from 90 to 120 days for ascertaining claims, and from 120 to 180 days for reviews has also faced opposition.

Critics argue the move would negatively impact cash flow and economic stability.

The Law Society of Kenya has further opposed the proposed removal of the 15% income tax rebate for companies that build at least 100 residential units annually, a measure introduced on January 1, 2017, to promote affordable housing in place of the standard 30% corporate tax.

They contend that scrapping the rebate could discourage both local and foreign investment.

“We will consider your views as stated,” Kuria Kimani, National Assembly Finance Committee chairman, stated.

The public hearings on the Finance Bill 2025 are being conducted concurrently with those for the Virtual Assets Providers Bill 2025, which aims to regulate tax measures related primarily to cryptocurrency transactions. 

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