The National Treasury has proposed a 35 percent income tax on all monthly salaries of Kenyans earning above five hundred thousand shillings.
In a copy of the Finance Bill 2023 seen by Nairobile.co.ke, the treasury proposes to amend the third schedule of the Income Tax Act.
“The individual rates of tax shall be: On the first Ksh. 288,000, 10%, On the next Ksh. 100,000 – 25%, On the next Ksh. 5,612,000 – 30% and On all income over Ksh. 6,000,000 - 35%,” the proposal reads in part.
The Treasury is also proposing 3 percent deductions on all employees’ basic salary towards the National Housing Development Fund, which will be matched by another 3 percent from the employer.
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The deductions will however not exceed five thousand shillings a month.
“An employer shall pay to the Housing Development Fund established under section 7 of the Housing Act, in respect of each employee. The employer's contribution at three per centum of the employee's monthly basic salary; and the employee's contribution at three per centum of the employee's monthly basic salary, provided that the sum of the employer and employee contributions shall not exceed five thousand shillings a month.” the proposal stated.
