Tax incentives are mainly in place to promote investment or exports. Major tax incentives available include:
Investment Deduction Allowances(IDA): introduced in 1991 to encourage new investment, Industrial Building Allowance: granted on cost of construction of buildings used for manufacturing purposes and also hotel premises, Capital Expenditure on agricultural land: targeted at farmers who incur capital expenditure in the course of their operations Mining deduction allowance: granted to businessmen involved in mining, Import duty set off: allows import duty paid on import of capital equipment to be set off against income tax payable Corporate tax stands at:Standard rate of 30%
25% for new listing at Nairobi Stock Exchange for 5 years
Rate of VAT:
Input for health care, education and exports of goods and services 0%
Export Processing Zones: allow for duty and VAT free importation of inputs for production of export products within specified zones. Incentives include 10 year tax holiday, exemptions from stamp duty, non liability on income tax for non resident employees, etc, Manufacture under bond: also allow for duty and VAT free importation but require that corporation tax be paid, Tax Remissions Export Office: TREO primarily involves VAT refunds since duty on most of their inputs is already at 0% Manufacture under bond: also allow for duty and VAT free importation but require that corporation tax be paid, Tax Remissions Export Office: TREO primarily involves VAT refunds since duty on most of their inputs is already at 0%
One Stop Shop – Kenya Investment Authority
- Registration of the business
- Submit applications for approval by the Kenya Investment Authority.
- Private/Public Partnership (PPP) in place
- Kenya is a member of MIGA (Multilateral Guarantee Agency) an affiliate of World Bank and guarantees against non-commercial risks.