Value Added Tax Act

Section 1. Short title Section This Act may be cited as the Value Added Tax Act.

Section 2. Interpretation Section 2(1) In this Act, unless the context otherwise requires— "aircraft" includes every description of conveyance for the transport by air of human beings or goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") ; "assessment" means— (a) a self-assessment return submitted under section 45 ; (b) an assessment made by the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") under section 45 ; or (c) an amended assessment under section 46 ; "Authority" means the Kenya Revenue Authority established by the Kenya Revenue Authority Act ( Cap. 469 ); "authorised officer" , in relation to any provision of this Act, means any officer appointed under section 3 who has been authorised by the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") to perform any functions under or in respect of that provision; "business" means— (a) trade, commerce or manufacture, profession, vocation or occupation; (b) any other activity in the nature of trade, commerce or manufacture, profession, vocation or occupation; (c) any activity carried on by a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") continuously or regularly, whether or not for gain or profit and which involves, in part or in whole, the supply of goods or services ("anything that is not goods or money;") for consideration; or (d) a supply ("a supply of goods or services;") of property by way of lease, licence, or similar arrangement, but does not include— (i) employment; (ii) a hobby or leisure activity of an individual; or (iii) an activity of a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") , other than an individual, that if carried on by an individual would come within subparagraph (ii) ; "Cabinet Secretary" means the Cabinet Secretary responsible for matters relating to finance; "Commissioner" means the Commissioner-General appointed under the Kenya Revenue Authority ("the Kenya Revenue Authority established by();") Act ( Cap. 469 ), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner; "company" means a company as defined in the Companies Act ( Cap. 486 ) or a corporate body formed under any other written law, including a foreign law, and includes any association, whether incorporated or not, formed outside Kenya which the Cabinet Secretary ("the Cabinet Secretary responsible for matters relating to finance;") may, by order, declare to be a company for the purposes of this Act; "concessional loan" means a loan with at least twenty-five percent grant element; "duty-free shop" means a bonded warehouse licensed by the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") of Customs for the deposit of dutiable goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") on which duty has not been paid and which have been entered for sale to passengers departing to places outside Kenya; "duty of customs" means import duty, excise duty, export ("to take or cause to be taken from Kenya to a foreign country, a special economic zone enterprise or to an export processing zone;") duty, countervailing duty, levy, cess, tax ("the value added tax chargeable under this Act;") or surtax charged under any law for the time being in force relating to customs or excise; "electronic notice system" deleted byAct No. 10 of 2018, s. 12; "exempt supplies" means supplies specified in the First Schedule which are not subject to tax ("the value added tax chargeable under this Act;") ; "export" means to take or cause to be taken from Kenya to a foreign country, a special economic zone enterprise or to an export processing zone ("an export processing zone designated under();") ; "export processing zone" means an export processing zone designated under the Export Processing Zones Act ( Cap. 517 ); "goods" means tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money ; "hotel" includes premises commonly referred to as "service flats", "service apartments", "beach cottages", "holiday cottages", "game lodges", "safari camps", "bandas" or "holiday villas" and other premises or establishments used for similar purposes, but does not include— (i) premises on which the only supply ("a supply of goods or services;") is under a lease or licence of not less than one month, unless the agreement relating thereto provides that by prior arrangement the occupier may, without penalty, terminate the lease or licence on less than one month's notice; or (ii) premises operated by an educational or training institution approved by the Cabinet Secretary ("the Cabinet Secretary responsible for matters relating to finance;") for the time being responsible for education for the use of the staff and students of that institution; or (iii) premises operated by a medical institution approved by the Cabinet Secretary ("the Cabinet Secretary responsible for matters relating to finance;") for the time being responsible for health, for the use of the staff and students of that institution; "information technology" means any equipment or software for use in storing, retrieving, processing or disseminating information; "importation" means to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone ("an export processing zone designated under();") ; "importer" , in relation to goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") , means the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") who owns the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") , or any other person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") who is, for the time being, in possession of or beneficially interested in the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") at the time of importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") ; "input tax" means— (a) tax ("the value added tax chargeable under this Act;") paid or payable on the supply ("a supply of goods or services;") to a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") of any goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") to be used by him for the purpose of his business ; and (b) tax ("the value added tax chargeable under this Act;") paid by a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") on the importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") of goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") to be used by him for the purposes of his business ; "Islamic finance arrangement" has the meaning assigned to it in section 2 of the Income Tax Act ( Cap. 470 ); "Islamic finance return" has the meaning assigned to it in section 2 of the Income Tax Act ( Cap. 470 ); "money" means— (a) any coin or paper currency that is legal tender in Kenya; (b) a bill of exchange, promissory note, bank draft, or postal or money order; (c) any amount provided by way of payment using a debit or credit card or electronic payment system; "non-resident person" deleted byAct No. 38 of 2016, s. 26(c); "official aid funded project" means a project funded by means of a grant or concessional loan ("a loan with at least twenty-five percent grant element;") in accordance with an agreement between the Government and any foreign government, agency, institution, foundation, organization or any other aid agency; "output tax" means tax ("the value added tax chargeable under this Act;") which is due on taxable supplies; "person" means an individual, company ("a company as defined in() or a corporate body formed under any other written law, including a foreign law, and includes any association, whether incorporated or not, formed outside Kenya which the Cabinet Secretary may, by order, declare to be a company for the purposes of this Act;") , partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government; "registered person" means any person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") registered under section 34 , but does not include an export processing zone ("an export processing zone designated under();") enterprise or a special economic zone; "regulations" means any subsidiary legislation made under this Act; "services" means anything that is not goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or money ; "service exported out of Kenya" means a service provided for use or consumption outside Kenya; "ship stores" means goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") for use in aircraft ("every description of conveyance for the transport by air of human beings or goods;") or vessels engaged in international transport for consumption by passengers and crew and includes goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") for sale on board such aircraft ("every description of conveyance for the transport by air of human beings or goods;") or vessels; "special economic zones" shall have the meaning assigned to it under the Special Economic Zones Act ( Cap. 517A ); "Sukuk" has the meaning assigned to it in section 2 of the Public Finance Management Act ( Cap. 412A ); "supply" means a supply of goods or services ("anything that is not goods or money;") ; "supply of goods" means— (a) a sale, exchange, or other transfer of the right to dispose of the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") as owner; or (b) the provision of electrical or thermal energy, gas or water; "supply of services" means anything done that is not a supply of goods or money , including— (a) the performance of services ("anything that is not goods or money;") for another person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ; (b) the grant, assignment, or surrender of any right; (c) the making available of any facility or advantage; or (d) the toleration of any situation or the refraining from the doing of any act; "supply of imported services" means a supply of services that satisfies the following conditions— (a) the supply ("a supply of goods or services;") is made by a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") who is not a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") to any person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ; (b) the supply ("a supply of goods or services;") would have been a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") if it had been made in Kenya; and (c) in the case of a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") , the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") would not have been entitled to a full amount of input tax payable if the services ("anything that is not goods or money;") had been acquired by that person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") in a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") ; "tax" means the value added tax chargeable under this Act; "tax computerized system" means any software or hardware for use in storing, retrieving, processing or disseminating information relating to tax ("the value added tax chargeable under this Act;") ; “tax invoice” includes an electronic tax invoice issued in accordance with section 23A of the Tax Procedures Act ( Cap. 469B ); "tax period" means one calendar month or such other period as may be prescribed in the regulations ("any subsidiary legislation made under this Act;") ; "tax registration certificate" means a tax registration certificate issued by the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") under section 34 ; "tax representative" deleted byAct No. 38 of 2016, s. 26(e); "taxable supply" means a supply ("a supply of goods or services;") , other than an exempt supply ("a supply of goods or services;") , made in Kenya by a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") in the course or furtherance of a business carried on by the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") , including a supply ("a supply of goods or services;") made in connection with the commencement or termination of a business ; "taxable value" means the value determined in accordance with section 13 and 14 ; "vehicle" includes every description of conveyance for the transport by land of human beings or goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") ; "zero-rated supply" means a supply ("a supply of goods or services;") listed in the Second Schedule. Section 2(2) For the purposes of this Act, goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") shall be classified by reference to the tariff numbers set out in Annex 1 to the Protocol on the Establishment of the East African Community Customs Union and in interpreting that Annex, the general rules of interpretation set out therein shall, with the necessary modifications, apply. Section 2(3) For the purposes of this Act— (a) Islamic finance return is treated as interest, whether received or paid on a financial arrangement; and (b) reference to "interest" includes a reference to Islamic finance return .

Section 3.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 4.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 5. Charge totax Section 5(1)(a) a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") made by a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") in Kenya; Section 5(1)(b) the importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") of taxable goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") ; and Section 5(1)(c) a supply ("a supply of goods or services;") of imported taxable services ("anything that is not goods or money;") . Section 5(2)(a) in the case of a zero-rated supply , zero per cent; or Section 5(2)(aa) deleted byAct No. 4 of 2023, s. 30(a); Section 5(2)(ab) deleted byAct No. 4 of 2023, s. 30(b); Section 5(2)(b) in any other case, sixteen per cent of the taxable value ("the value determined in accordance with sectionand;") of the taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") , the value of imported taxable goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or the value of a supply ("a supply of goods or services;") of imported taxable services ("anything that is not goods or money;") . Section 5(3) Tax on a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") shall be a liability of the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") making the supply ("a supply of goods or services;") and, subject to the provisions of this Act relating to accounting and payment, shall become due at the time of the supply ("a supply of goods or services;") . Section 5(4) The amount of tax ("the value added tax chargeable under this Act;") payable on a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") , if any, shall be recoverable by the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") from the receiver of the supply ("a supply of goods or services;") , in addition to the consideration. Section 5(5) Tax on the importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") of taxable goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") shall be charged as if it were duty of customs ("import duty, excise duty,export duty, countervailing duty, levy, cess,tax or surtax charged under any law for the time being in force relating to customs or excise;") and shall become due and payable by the importer at the time of importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") . Section 5(6) Tax on the supply ("a supply of goods or services;") of imported taxable services ("anything that is not goods or money;") shall be a liability of any person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") receiving the supply ("a supply of goods or services;") and, subject to the provisions of this Act relating to accounting and payment, shall become due at the time of the supply ("a supply of goods or services;") . Section 5(7) The provisions of subsection (1) shall be applicable to supplies made over the internet or an electronic network or through a digital marketplace. Section 5(8) The Cabinet Secretary ("the Cabinet Secretary responsible for matters relating to finance;") shall make regulations ("any subsidiary legislation made under this Act;") to provide the mechanisms for implementing the provisions of subsection (7) . Section 5(9) For the purposes of this section, "digital marketplace" means an online platform which enables users to sell goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or provide services ("anything that is not goods or money;") to other users.

Section 6.Cabinet Secretarymay amend the rate oftax Section 6(1) The Cabinet Secretary ("the Cabinet Secretary responsible for matters relating to finance;") may, by order published in the Gazette , amend the rate of tax ("the value added tax chargeable under this Act;") by increasing or decreasing any of the rates of tax ("the value added tax chargeable under this Act;") by an amount not exceeding twenty-five per cent of the rate specified in section 5(2)(b) . Section 6(2) Every order made under subsection (1) shall be laid before the National Assembly without unreasonable delay, and shall cease to have effect if a resolution of the National Assembly disapproving the order is passed within twenty days of the day on which the National Assembly next sits after the order is laid, but without prejudice to anything previously done thereunder.

Section 7. Zero rating Section 7(1) Where a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") supplies goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") and the supply ("a supply of goods or services;") is zero rated, no tax ("the value added tax chargeable under this Act;") shall be charged on the supply ("a supply of goods or services;") , but it shall, in all other respects, be treated as a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") . Section 7(2) A supply ("a supply of goods or services;") or importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") of goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") shall be zero-rated under this section if the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") are of the description for the time being specified in the Second Schedule.

Section 10. Treatment of importedservices Section 10(1) If a supply ("a supply of goods or services;") of imported taxable services ("anything that is not goods or money;") is made to any person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") , the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") shall be deemed to have made a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") to himself. Section 10(1A) The provisions of subsection (1) shall not apply to taxable supplies made under section 5(7) . Section 10(2)(a) a credit for part of the amount of input tax payable, the value of the taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") under subsection (1) shall be reduced by an amount equal to the supply ("a supply of goods or services;") that is entitled for the input tax credit; or Section 10(2)(b) a full input tax credit payable on the imported taxable services ("anything that is not goods or money;") under subsection (1) , the value of the taxable services ("anything that is not goods or money;") shall be reduced to zero. Section 10(3) The output tax ("tax which is due on taxable supplies;") in respect of a deemed taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") under subsection (1) shall be payable at the time of the supply ("a supply of goods or services;") . Section 10(4) For the purposes of this section, if a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") carries on a business , both in and outside Kenya, the part of the business carried on outside Kenya shall be treated as if it were carried out by a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") separate from the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") .

Section 11. Place ofsupply of goods Section the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") are delivered or made available in Kenya by the supplier;

Section 12. Time ofsupply of goodsandservices Section 12(1)(a) the date on which the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") are delivered or services ("anything that is not goods or money;") performed; Section 12(1)(b) the date a certificate is issued by an architect, surveyor or any other person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") acting as a consultant in a supervisory capacity; Section 12(1)(c) the date on which the invoice for the supply ("a supply of goods or services;") is issued; or Section 12(1)(d) the date on which payment for the supply ("a supply of goods or services;") is received, in whole or in part. Section 12(1A) Subject to subsection (1) , in the case of the national carrier, the time of supply ("a supply of goods or services;") shall be the date on which the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") are delivered or services ("anything that is not goods or money;") performed. Section 12(2) The time of supply of goods by means of a vending machine, meter, or other device operated by use of a coin, note, or token shall be on the date the coin, note, or token is taken from the machine, meter, or other device by or on behalf of the supplier. Section 12(3)(a) goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") are supplied under a rental agreement; or Section 12(3)(b) goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") are made by metered supplies, or under an agreement or law that provides for periodic payments, the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") shall be treated as successively supplied for successive parts of the period of the lease or agreement, or as determined by law, and the time of each successive supply ("a supply of goods or services;") shall be the earlier of the date on which payment for the successive supply ("a supply of goods or services;") is due or received. Section 12(4)(a) in the case of goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") cleared for home use directly at the port of importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") , or goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") entered for removal to an inland station and there cleared for home use, at the time of customs clearance; Section 12(4)(b) in the case of goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") removed to a licensed warehouse subsequent to importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") , at the time of final clearance from the warehouse for home use; Section 12(4)(c) in the case of goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") removed from an export processing zone ("an export processing zone designated under();") or a special economic zone, at the time of removal for home use; Section 12(4)(d) in any other case, at the time the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") are brought into Kenya. Section 12(5) The time supply ("a supply of goods or services;") for exported goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") shall be the time when the certificate of export ("to take or cause to be taken from Kenya to a foreign country, a special economic zone enterprise or to an export processing zone;") or such other equivalent export ("to take or cause to be taken from Kenya to a foreign country, a special economic zone enterprise or to an export processing zone;") document has been issued by Customs.

Section 8. Place ofsupply of services Section 8(1) A supply of services is made in Kenya if the place of business of the supplier from which the services ("anything that is not goods or money;") are supplied is in Kenya. Section 8(2)(a) the services ("anything that is not goods or money;") are physically performed in Kenya by a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") who is in Kenya at the time of supply ("a supply of goods or services;") ; Section 8(2)(b) the services ("anything that is not goods or money;") are directly related to immovable property in Kenya; Section 8(2)(c) deleted byAct No. 9 of 2025, s. 33(a)(ii) ; Section 8(2)(d) the services ("anything that is not goods or money;") are electronic services ("anything that is not goods or money;") delivered to a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") in Kenya at the time of supply ("a supply of goods or services;") ; or Section 8(2)(e) the supply ("a supply of goods or services;") is a transfer or assignment of, or grant of a right to use, a copyright, patent, trademark, or similar right in Kenya. Section 8(3)(a) websites, web-hosting, or remote maintenance of programs and equipment; Section 8(3)(b) software and the updating of software; Section 8(3)(c) images, text, and information; Section 8(3)(d) access to databases; Section 8(3)(e) self-education packages; Section 8(3)(f) music, films, and games, including games of chance; or Section 8(3)(g) political, cultural, artistic, sporting, scientific and other broadcasts and events including internet, radio or television broadcasting services ("anything that is not goods or money;") .

Section 9.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 34. Application for registration Section 34(1)(a) has made taxable supplies or expects to make taxable supplies, the value of which is five million shillings or more in any period of twelve months; or Section 34(1)(b) is about to commence making taxable supplies the value of which is reasonably expected to exceed five million shillings in any period of twelve months, Section 34(2)(a) a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") of a capital asset of the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ; and Section 34(2)(b) a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") made solely as a consequence of the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") selling the whole or a part of the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s business or permanently ceasing to carry on the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s business . Section 34(3) Notwithstanding subsection (1) , a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") who makes or intends to make taxable supplies may apply, in the prescribed form, to the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") for voluntary registration. Section 34(4)(a) the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") is making, or shall make taxable supplies; Section 34(4)(b) the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has a fixed place from which the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s business is conducted; Section 34(4)(c) has kept proper records of its business ; and Section 34(4)(c)(i) has kept proper records of its business ; and Section 34(4)(c)(ii) has complied with its obligations under other revenue laws; and Section 34(4)(d) there are reasonable grounds to believe that the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") shall keep proper records and file regular and reliable tax ("the value added tax chargeable under this Act;") returns. Section 34(5) The Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") shall issue a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") with a tax registration certificate ("a tax registration certificate issued by the Commissioner under section;") in the prescribed form. Section 34(6) If the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") is satisfied that a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") eligible to apply for registration has not done so within the time limit specified in subsection (1) , the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") shall register the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") . Section 34(7) The registration of a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") under subsection (1) or (6) shall take effect from the beginning of the first tax period ("one calendar month or such other period as may be prescribed in the regulations;") after the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") is required to apply for registration, or such later period as may be specified in the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s tax registration certificate ("a tax registration certificate issued by the Commissioner under section;") . Section 34(8) The registration of a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") under subsection (4) shall take effect from the date specified in the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s tax registration certificate ("a tax registration certificate issued by the Commissioner under section;") . Section 34(9) The Cabinet Secretary ("the Cabinet Secretary responsible for matters relating to finance;") may, in regulations ("any subsidiary legislation made under this Act;") , provide for the registration of a group of companies as one registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") for the purposes of the Act.

Section 35. Registeredpersonto display certificate Section 35(1)(a) the tax registration certificate ("a tax registration certificate issued by the Commissioner under section;") at the principal place at which the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") carries on business ; and Section 35(1)(b) a copy of the certificate at every other place at which the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") carries on business . Section 35(2) A registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") shall notify the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") , in writing, of any change in the name (including the business name), address, place of business , or nature of the business of the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") within twenty-one days of the change.

Section 36. Cancellation of registration Section 36(1) A registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") who ceases to make taxable supplies shall apply in writing to the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") , for the cancellation of the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s registration, within thirty days of the date on which the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ceases to make taxable supplies. Section 36(2) A registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") who continues to make taxable supplies whose annual value does not exceed the registration threshold may apply in writing to the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") , for cancellation of the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s registration. Section 36(3)(a) the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has applied for cancellation under subsection (1) and the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") is satisfied that the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has ceased to make taxable supplies; or Section 36(3)(b) the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has not applied for cancellation but the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") is satisfied that the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has ceased to make taxable supplies and is not otherwise required to be registered. Section 36(4)(a) the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") shall, if the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has been registered for a period of more than twelve months, by notice in writing, cancel the registration; or Section 36(4)(b) the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") may, if the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has been registered for a period of twelve months or less, by notice in writing, cancel the registration. Section 36(5)(a) kept proper tax ("the value added tax chargeable under this Act;") records; Section 36(5)(b) furnished regular and reliable returns; or Section 36(5)(c) complied with obligations under other revenue laws, and there are reasonable grounds to believe that the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") will not keep proper records or furnish regular and reliable returns. Section 36(6) The cancellation of a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s registration shall take effect from the date specified in the notice of cancellation. Section 36(7)(a) immediately cease to hold out that the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") is a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") , including on any documentation used by the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ; Section 36(7)(b) submit a final return and pay all tax ("the value added tax chargeable under this Act;") due, including the tax ("the value added tax chargeable under this Act;") due under subsection (9) , within fifteen days after the date of cancellation of the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s registration. Section 36(8) Notwithstanding the cancellation of registration of a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") under this section, the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") shall be liable for any act done or omitted to be done while registered. Section 36(9) A person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") whose registration is cancelled shall be deemed to have made a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") of any trading stock on hand at the time the registration is cancelled if the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") was allowed an input tax credit for the acquisition or import of the stock, or in respect of the acquisition or import of goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") that have been subsumed into that stock. Section 36(10) The taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") under subsection (9) shall be deemed to have been made by the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") immediately before the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") ’s registration is cancelled and the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") shall be liable for an amount of output tax ("tax which is due on taxable supplies;") in respect of the supply ("a supply of goods or services;") equal to the amount of the input tax credit allowed to the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") on acquisition or import of the stock.

Section 37. Offences relating to registration Section fails to apply for registration as required under this Act;

Section 13. Taxable value ofsupply Section 13(1)(a) the consideration for the supply ("a supply of goods or services;") ; or Section 13(1)(b) if the supplier and recipient are related, the open market value of the supply ("a supply of goods or services;") . Section 13(2) Deleted byAct No. 10 of 2018, s. 14. Section 13(3)(a) the amount in money paid or payable, directly or indirectly, by any person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") , for the supply ("a supply of goods or services;") ; or Section 13(3)(b) the open market value at the time of the supply ("a supply of goods or services;") of an amount in kind paid or payable, directly or indirectly, by any person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") , for the supply ("a supply of goods or services;") ; and Section 13(3)(c) any taxes, duties, levies, fees, and charges (other than value added tax ("the value added tax chargeable under this Act;") ) paid or payable on, or by reason of the supply ("a supply of goods or services;") , Section 13(4)(a) any wrapper, package, box, bottle, or other container in which goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") are supplied; Section 13(4)(b) any other goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") contained in or attached to the wrapper, package, box, bottle or other container referred to in paragraph (a) ; or Section 13(4)(c) any liability that the purchaser has to pay to the vendor by reason of or in respect of the supply ("a supply of goods or services;") in addition to the amount charged as price. Section 13(5) In calculating the value of any services ("anything that is not goods or money;") for the purposes of subsection (1) , there shall be included any incidental costs incurred by the supplier of the services ("anything that is not goods or money;") in the course of making the supply ("a supply of goods or services;") to the client: Provided that, if the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") is satisfied that the supplier has merely made a disbursement to a third party as an agent of his client, then such disbursement shall be excluded from the taxable value ("the value determined in accordance with sectionand;") . Section 13(6)(a) in the case of a supply of goods under a hire purchase agreement, any financial charge payable in relation to a supply ("a supply of goods or services;") of credit under the agreement; or Section 13(6)(b) any interest incurred for the late payment of the consideration for the supply ("a supply of goods or services;") . Section 13(7)(a) the service charge is distributed directly to the employees of the hotel or restaurant in accordance with a written agreement between the employer and the employee; and Section 13(7)(b) the service charge does not exceed ten per cent of the price of the service, excluding such service charge. Section 13(8)(a) either person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") participates, directly or indirectly, in the management, control or the capital of the business of the other; Section 13(8)(b) a third person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") participates, directly or indirectly, in the management, control or capital of the business of both; or Section 13(8)(c) an individual who participates in the management, control or capital of the business of one, is associated by marriage, consanguinity or affinity to an individual who participates in the management, control or capital of the business of the other.

Section 14. Taxable value of importedgoods Section 14(1)(a) the value of the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") ascertained for the purpose of customs duty, in accordance with the East African Community Custom Management Act, 2004, whether or not any duty of customs ("import duty, excise duty,export duty, countervailing duty, levy, cess,tax or surtax charged under any law for the time being in force relating to customs or excise;") is payable on the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") ; Section 14(1)(b) the cost of insurance and freight incurred in bringing the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") to Kenya; and Section 14(1)(b)(i) the cost of insurance and freight incurred in bringing the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") to Kenya; and Section 14(1)(b)(ii) the cost of services ("anything that is not goods or money;") treated as part of the imported goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") under this section; and Section 14(1)(c) the amount of duty of customs ("import duty, excise duty,export duty, countervailing duty, levy, cess,tax or surtax charged under any law for the time being in force relating to customs or excise;") , if any, paid on those goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") . Section 14(2) Unless the context otherwise requires, a supply of services that is ancillary or incidental to the importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") of goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") shall be treated as part of the importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") .

Section 15. Deemedtaxable supply Section 15(1) An application of taxable supplies by a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") for use outside his business shall be a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") made by the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") . Section 15(2) A taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") under subsection (1) shall be deemed to have been made by the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") on the date the supply ("a supply of goods or services;") is first used outside the business .

Section 16. Debit and credit note Section 16(1) Where goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") are returned to the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") or, for good and valid reason the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") decides for business reasons, to reduce the value of a supply ("a supply of goods or services;") after the issue of a tax invoice , a credit note shall be issued for the amount of the reduction: Provided that a credit note may be issued- (a) only within six months after the issue of the relevant tax invoice ; or (b) where there is a commercial dispute in court with regard to the price payable, within thirty days after the determination of the matter. Section 16(2) A registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") who issues a credit note under this section shall reduce the amount of his output tax ("tax which is due on taxable supplies;") in the tax period ("one calendar month or such other period as may be prescribed in the regulations;") in which the credit note was issued by an amount that bears the same proportion to the tax ("the value added tax chargeable under this Act;") originally charged as the amount credited bears to the total amount originally charged and the amount of tax ("the value added tax chargeable under this Act;") so credited shall be specified on the credit note. Section 16(3) A registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") who receives a credit note for the supply ("a supply of goods or services;") in respect of which he has claimed deductible input tax , shall reduce the amount of deductible input tax in the month in which the credit note is received, by the amount of tax ("the value added tax chargeable under this Act;") credited. Section 16(4) Where a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") has issued a tax invoice in respect of a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") and subsequently makes a further charge in respect of that supply ("a supply of goods or services;") , or any transaction associated with that supply ("a supply of goods or services;") , the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") shall, in respect of the further charge being made, issue a debit note, and shall show on it the details of the tax invoice issued at the time of the original supply ("a supply of goods or services;") . Section 16(5) A registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") who receives a debit note issued in compliance with subsection (4) may, if the supply ("a supply of goods or services;") is eligible therefor and in so far as it has not previously been claimed, claim as deductible input tax such further amount of tax ("the value added tax chargeable under this Act;") that is being charged, in the month in which the further charge was made, or in the next subsequent month. Section 16(6) A credit or debit note issued under this section shall be in the prescribed form.

Section 17. Credit forinput taxagainstoutput tax Section 17(1) Subject to the provisions of this Act and the regulations ("any subsidiary legislation made under this Act;") , input tax on a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") to, or importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") made by, a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") may, at the end of the tax period ("one calendar month or such other period as may be prescribed in the regulations;") in which the supply ("a supply of goods or services;") or importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") occurred, be deducted by the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") in a return for the period, subject to the exceptions provided under this section, from the tax ("the value added tax chargeable under this Act;") payable by the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") on supplies by him in that tax period ("one calendar month or such other period as may be prescribed in the regulations;") , but only to the extent that the supply ("a supply of goods or services;") or importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") was acquired to make taxable supplies. Section 17(2)(a) the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") does not hold the documentation referred to in subsection (3) , and Section 17(2)(b) the registered supplier has not declared the sales invoice in a return, Section 17(3)(a) an original tax invoice issued for the supply ("a supply of goods or services;") or a certified copy; Section 17(3)(b) a customs entry duly certified by the proper officer and a receipt for the payment of tax ("the value added tax chargeable under this Act;") ; Section 17(3)(c) a customs receipt and a certificate signed by the proper officer stating the amount of tax ("the value added tax chargeable under this Act;") paid, in the case of goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") purchased from a customs auction; and Section 17(3)(d) a credit note in the case of input tax deducted under section 16(2) ; Section 17(3)(e) a debit note in the case of input tax deducted under section 16(5) ; or Section 17(3)(f) in the case of a participant in the Open Tender System for the importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") of petroleum products that have been cleared through a non-bonded facility, the custom entry showing the name and PIN of the winner of the tender and the name of the other oil marketing company ("a company as defined in() or a corporate body formed under any other written law, including a foreign law, and includes any association, whether incorporated or not, formed outside Kenya which the Cabinet Secretary may, by order, declare to be a company for the purposes of this Act;") participating in the tender: Section 17(4)(a) passenger cars or mini buses, and the repair and maintenance thereof including spare parts, unless the passenger cars or mini buses are acquired by the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") exclusively for the purpose of making a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") of that automobile in the ordinary course of a continuous and regular business of selling or dealing in or hiring of passenger cars or mini buses; or Section 17(4)(b) the services ("anything that is not goods or money;") are provided in the ordinary course of the business carried on by the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") to provide the services ("anything that is not goods or money;") and the services ("anything that is not goods or money;") are not supplied to an associate or employee; or Section 17(4)(b)(i) the services ("anything that is not goods or money;") are provided in the ordinary course of the business carried on by the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") to provide the services ("anything that is not goods or money;") and the services ("anything that is not goods or money;") are not supplied to an associate or employee; or Section 17(4)(b)(ii) the services ("anything that is not goods or money;") are provided while the recipient is away from home for the purposes of the business of the recipient or the recipient’s employer: Section 17(5)(a) such excess arises from making zero rated supplies; or Section 17(5)(b) such excess arises from tax ("the value added tax chargeable under this Act;") withheld by appointed tax ("the value added tax chargeable under this Act;") withholding agents; and Section 17(5)(c) such excess arising out of tax ("the value added tax chargeable under this Act;") withheld by appointed tax ("the value added tax chargeable under this Act;") withholding agents may be applied against any tax ("the value added tax chargeable under this Act;") payable under this Act or any other written law, or is due for refund pursuant to section 47(4) of the Tax Procedures Act ( Cap. 469B ); and Section 17(5)(d) the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") lodges the claim for refund of the excess tax ("the value added tax chargeable under this Act;") within twelve months from the date the tax ("the value added tax chargeable under this Act;") becomes due and payable; and Section 17(5)(e) deleted byAct No. 9 of 2025, s. 34(b); Section 17(5)(ea) such excess credit in respect of a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") that became zero rated on 1st July, 2023: Section 17(6)(a) full deduction of all the input tax attributable to taxable supplies; Section 17(6)(b) no deduction of any input tax which is directly attributable to other use; and Section 17(6)(c) deduction of input tax attributable to both taxable supplies and other uses calculated according to the following formula: A xBC where— A is the total amount of input tax payable by the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") during the tax period ("one calendar month or such other period as may be prescribed in the regulations;") on acquisitions that relate partly to making taxable supplies and partly for another use; B is the value of all taxable supplies made by the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") during the period; and C is the value of all supplies made by the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") during the period in Kenya. Section 17(7) Deleted byAct No. 12 of 2024, s. 19(b). Section 17(8) Deleted byAct No. 12 of 2024, s. 19(c). Section 17(9)(a) if the compensation includes value added tax ("the value added tax chargeable under this Act;") , the compensation shall be declared and the value added tax ("the value added tax chargeable under this Act;") thereon remitted to the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") ; or Section 17(9)(b) if the compensation does not include value added tax ("the value added tax chargeable under this Act;") , the compensation shall be declared and subjected to value added tax ("the value added tax chargeable under this Act;") and the tax ("the value added tax chargeable under this Act;") remitted to the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") .

Section 18. Tax paid prior to registration Section 18(1)(a) on the date exempt supplies ("supplies specified in the First Schedule which are not subject to tax;") made by a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") become taxable, and the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") had incurred input tax on such supplies; or Section 18(1)(b) on the date he is registered, a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has incurred tax ("the value added tax chargeable under this Act;") on taxable supplies which are intended for use in making taxable supplies, the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") may, within three months from that date, claim relief from any tax ("the value added tax chargeable under this Act;") shown to have been incurred on such supplies: Section 18(2) Where the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") is satisfied that the claim for relief is justified, he shall authorise the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") to make an appropriate deduction of the relief claimed under subsection (1) from the tax ("the value added tax chargeable under this Act;") payable on his next return. Section 18(3) The claim for relief from tax ("the value added tax chargeable under this Act;") under subsection (1) shall be made in the prescribed form.

Section 19. Whentaxis due Section 19(1) Tax shall be due and payable at the time of supply ("a supply of goods or services;") . Section 19(2) Notwithstanding the provision of subsection (1) , a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") may defer payment of tax ("the value added tax chargeable under this Act;") due to a date not later than the twentieth day of the month succeeding that in which the tax ("the value added tax chargeable under this Act;") became due.

Section 20.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 21.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 22. Importedgoodssubject to customs control Section 22(1) A person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") shall not be entitled to obtain delivery of imported taxable goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") from the control of the customs unless the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has paid, in full, the correct amount of tax ("the value added tax chargeable under this Act;") due. Section 22(2) Notwithstanding the provisions of any other written law, any taxable goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") which are imported by air, land or water shall be produced by the importer to a proper officer of customs at the customs station at or nearest to the place of entry, and any importer who fails to produce any such goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") commits an offence and the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") in respect of which the offence was committed shall be liable to forfeiture. Section 22(3)(a) shall collect tax ("the value added tax chargeable under this Act;") payable under this Act on imported goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") at the time of importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") and shall, at that time, obtain such information as may be prescribed in respect of the importation ("to bring or cause to be brought into Kenya from a foreign country, a special economic zone enterprise or from an export processing zone;") ; and Section 22(3)(b) may make arrangements for such functions to be performed on his behalf in respect of imported goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") through the postal service. Section 22(4)(a) the Tax Procedures Act ( Cap. 469B ) shall apply with regard to imposition of interest and penalties; and Section 22(4)(b) in cases where interest becomes payable it shall not, in aggregate, exceed the principal tax ("the value added tax chargeable under this Act;") .

Section 23.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 24.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 25.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 25A.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 26.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 27.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 28.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 29.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 30.[Repealed byAct No. 22 of 2022, s. 28)

Section 31. Refund oftaxon bad debts Section 31(1)(a) has not received any payment from the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") liable to pay the tax ("the value added tax chargeable under this Act;") , he may, after a period of two years from the date of the supply ("a supply of goods or services;") ; or Section 31(1)(b) the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") to whom the supply ("a supply of goods or services;") was made has been placed under statutory management through the appointment of an administrator, receiver, or liquidator, Section 31(2) Where the tax ("the value added tax chargeable under this Act;") refunded under subsection (1) is subsequently recovered from the recipient of the supply ("a supply of goods or services;") , the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") shall refund the tax ("the value added tax chargeable under this Act;") to the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") within thirty days of the date of the recovery. Section 31(3) If payment is not made within the time specified under subsection (2) , an interest of two per cent per month or part thereof of the tax ("the value added tax chargeable under this Act;") refunded shall forthwith be due and payable: Provided that the interest payable shall not exceed one hundred per cent of the refunded amount.

Section 32.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 33.[Repealed byAct No. 38 of 2016, s. 28]

Section 38.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 39.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 40.[Repealed byAct No. 10 of 2018, s. 16]

Section 41.[Repealed byAct No. 10 of 2018, s. 17]

Section 42. Tax invoice Section 42(1) Subject to subsection (2) , a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") who makes a supply ("a supply of goods or services;") shall, at the time of the supply ("a supply of goods or services;") furnish the purchaser with the tax invoice containing the prescribed details for the supply ("a supply of goods or services;") . Section 42(2)(a) which is not a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") ; or Section 42(2)(b) by a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") who is not registered. Section 42(3) Any person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") who issues an invoice in contravention of this subsection commits an offence and any tax ("the value added tax chargeable under this Act;") shown thereon shall become due and payable to the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") within seven days of the date of the invoice. Section 42(4) A registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") shall issue only one original tax invoice for a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") , or one original credit note or debit note, but a copy clearly marked as such may be provided to a registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") who claims to have lost the original.

Section 43. Keeping of records Section 43(1) A person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") shall, for the purposes of this Act, keep in the course of his business , a full and true written record, whether in electronic form or otherwise, in English or Kiswahili of every transaction he makes and the record shall be kept for a period of five years from the date of the last entry made therein. Section 43(2)(a) copies of all tax ("the value added tax chargeable under this Act;") invoices and simplified tax ("the value added tax chargeable under this Act;") invoices issued in serial number order; Section 43(2)(b) copies of all credit and debit notes issued, in chronological order; Section 43(2)(c) purchase invoices, copies of customs entries, receipts for the payment of customs duty or tax ("the value added tax chargeable under this Act;") , and credit and debit notes received, to be filed chronologically either by date of receipt or under each supplier’s name; Section 43(2)(d) details of the amounts of tax ("the value added tax chargeable under this Act;") charged on each supply ("a supply of goods or services;") made or received and in relation to all services ("anything that is not goods or money;") to which section 10 applies, sufficient written evidence to identify the supplier and the recipient, and to show the nature and quantity of services ("anything that is not goods or money;") supplied, the time of supply ("a supply of goods or services;") , the place of supply ("a supply of goods or services;") , the consideration for the supply ("a supply of goods or services;") , and the extent to which the supply ("a supply of goods or services;") has been used by the recipient for a particular purpose; Section 43(2)(e) tax ("the value added tax chargeable under this Act;") account showing the totals of the output tax ("tax which is due on taxable supplies;") and the input tax in each period and a net total of the tax ("the value added tax chargeable under this Act;") payable or the excess tax ("the value added tax chargeable under this Act;") carried forward, as the case may be, at the end of each period; Section 43(2)(f) copies of stock records kept periodically as the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") may determine; Section 43(2)(g) details of each supply of goods and services ("anything that is not goods or money;") from the business premises, unless such details are available at the time of supply ("a supply of goods or services;") on invoices issued at, or before, that time; and Section 43(2)(h) such other accounts or records as may be specified, in writing, by the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") . Section 43(3) Every person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") required under subsection (1) to keep records shall, at all reasonable times, avail the records to an authorised officer for inspection and shall give the officer every facility necessary to inspect the records. Section 43(4) For the purposes of this section, the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") may, in accordance with the regulations ("any subsidiary legislation made under this Act;") , require any person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") to use an electronic tax ("the value added tax chargeable under this Act;") register, of such type and description as may be prescribed, for the purpose of accessing information regarding any matter or transaction which may affect the tax ("the value added tax chargeable under this Act;") liability of the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") . Section 43(5) A person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") who contravenes any of the provisions of this section commits an offence.

Section 44. Submission of returns Section 44(1) Every registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") shall submit a return, in the prescribed form and manner, in respect of each tax period ("one calendar month or such other period as may be prescribed in the regulations;") not later than the twentieth day after the end of that period. Section 44(2) Deleted byAct No. 10 of 2018, s. 18. Section 44(3) Deleted byAct No. 10 of 2018, s. 18. Section 44(4) Deleted byAct No. 10 of 2018, s. 18. Section 44(5) Deleted byAct No. 10 of 2018, s. 18.

Section 45.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 46.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 47.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 48.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 49.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 50.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 51.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 52.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 53.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 54.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 55.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 56.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 57.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 58.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 59.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 60.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 61.[Deleted byAct No. 29 of 2015, 2nd Sch.]

Section 62. Burden of proof Section In any civil proceedings under this Act, the burden of proving that any tax ("the value added tax chargeable under this Act;") has been paid or that any goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") are exempt from payment of tax ("the value added tax chargeable under this Act;") shall lie on the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") liable to pay the tax ("the value added tax chargeable under this Act;") or claiming that the tax ("the value added tax chargeable under this Act;") has been paid or that the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") are exempt from payment of tax ("the value added tax chargeable under this Act;") .

Section 63. General penalty Section A person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") convicted of an offence under this Act for which no other penalty is provided shall be liable to a fine not exceeding one million shillings, or to imprisonment for a term not exceeding three years, or to both.

Section 64. Effect on imposition or variation oftax Section 64(1)(a) in the case of the alteration being a new or increased tax ("the value added tax chargeable under this Act;") , the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") may, after payment of the tax ("the value added tax chargeable under this Act;") , whether directly or indirectly, add the difference caused by the alteration to the agreed price; Section 64(1)(b) in the case of the alteration being the abolition or reduction of tax ("the value added tax chargeable under this Act;") , the purchaser may, if the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") has not, directly or indirectly, paid the tax ("the value added tax chargeable under this Act;") or has paid the tax ("the value added tax chargeable under this Act;") at a lower rate, deduct the difference caused by the alteration from the agreed price; Section 64(1)(c) any refund or payment of increased tax ("the value added tax chargeable under this Act;") resulting from the alteration not being finally adopted shall be adjusted between the parties to the agreement as the case may require. Section 64(2) If, under any law relating to the control of prices or charges, a price is fixed, or any variation in price is prohibited or regulated, in relation to any taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") then, notwithstanding any provision of that law, where tax ("the value added tax chargeable under this Act;") in relation to that supply ("a supply of goods or services;") is imposed or altered the price may be varied strictly in accordance with that imposition or variation when the registered person ("any person registered under section, but does not include an export processing zone enterprise or a special economic zone;") has, directly or indirectly, been affected by that imposition or alteration.

Section 65. Application of East African Community Customs ManagementAct (No. 1 of 2005) Section Subject to this Act, the East African Community Customs Management Act (No. 1 of 2005) and any rules made thereunder relating to customs generally, whether made before or after the commencement of this Act, shall have effect, with such exceptions and adaptations as may be prescribed, in relation to imported taxable goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") and exported goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") , whether liable to any duty of customs ("import duty, excise duty,export duty, countervailing duty, levy, cess,tax or surtax charged under any law for the time being in force relating to customs or excise;") or not, as if all such goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") were liable to duties of customs and as if those duties included tax ("the value added tax chargeable under this Act;") . ( Act No. 12 of 2024 , s. 20)

Section 66. Tax avoidance schemes Section 66(1)(a) a scheme has been entered into or carried out; Section 66(1)(b) a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") has obtained a tax ("the value added tax chargeable under this Act;") benefit in connection with the scheme; and Section 66(1)(c) having regard to the substance of the scheme, it would be concluded that a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") , or one of the persons, who entered into or carried out the scheme did so for the sole or dominant purpose of enabling the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") referred to in paragraph (b) to obtain a tax ("the value added tax chargeable under this Act;") benefit, Section 66(2) If a determination is made under subsection (1) , the Commissioner ("the Commissioner-General appointed under the Kenya Revenue Authority Act (), or, with respect to powers or functions that have been delegated under that Act to another Commissioner, that other Commissioner;") shall issue an assessment giving effect to the determination. Section 66(3) A determination under subsection (1) shall be made within five years from the last day of the tax period ("one calendar month or such other period as may be prescribed in the regulations;") to which the determination relates. Section 66(4)(a) a reduction in the liability of a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") to pay tax ("the value added tax chargeable under this Act;") ; Section 66(4)(b) an increase in the entitlement of a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") to a deduction for input tax ; Section 66(4)(c) an entitlement to a refund; Section 66(4)(d) a postponement of a liability for the payment of tax ("the value added tax chargeable under this Act;") ; Section 66(4)(e) an acceleration of an entitlement to a deduction for input tax ; Section 66(4)(f) any other advantage arising because of a delay in payment of tax ("the value added tax chargeable under this Act;") or an acceleration of the entitlement to a deduction for input tax ; Section 66(4)(g) anything that causes a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") or taxable import not to be a taxable supply ("a supply, other than an exempt supply, made in Kenya by a person in the course or furtherance of a business carried on by the person, including a supply made in connection with the commencement or termination of a business;") or taxable import, as the case may be; or Section 66(4)(h) anything that gives rise to a deduction for input tax for an acquisition or import that is used or is intended to be used other than in making taxable supplies.

Section 66A. Liability to paytaxfor exempt and zero-rated supplies Section Where a person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") imports or purchases goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") which are exempt or zero-rated and the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") subsequently disposes of, or uses, the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") supplied in a manner inconsistent with the purpose for which the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") were exempted or zero rated, the person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") shall be liable to pay tax ("the value added tax chargeable under this Act;") on the goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") at the applicable rate at the time of disposal or inconsistent use. ( Act No. 9 of 2025 , s. 37)

Section 67. Regulations Section 67(2) Regulations made under this section shall be tabled before the National Assembly for approval before they take effect.

Section 68. Repeal of Cap. 476, transitional and savings provisions Section 68(1) The Value Added Tax Act, 1989 is repealed. Section 68(2) Notwithstanding the repeal of the Value Added Tax Act, the provisions of that Act shall remain in full force and effect for the purposes of the assessment and collection of any tax ("the value added tax chargeable under this Act;") and the recovery of any penalty, payable under the Act and outstanding at the date upon which such repeal becomes effective. Section 68(2A) Notwithstanding the repeal of paragraph 102 of the First Schedule, the exemption of goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") imported or purchased locally for direct and exclusive use in the implementation of projects under a special operating framework arrangement with the Government, shall continue for existing projects for the remaining period of the agreement. Section 68(3) Any subsidiary legislation made under the repealed Act in force at the commencement of this Act shall remain in force, so far as it is not inconsistent with this Act, until subsidiary legislation with respect to the same matter is made under this Act. Section 68(4) Where a remission of tax ("the value added tax chargeable under this Act;") was granted under the repealed Act on any taxable goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") , such remission shall continue to remain in force for a period of five years from the date of commencement of this Act. Section 68(4A) For the avoidance of doubt and despite any other provision of this Act or other written law for the time being in force, the expression "remission of tax ("the value added tax chargeable under this Act;") " in subsection (4) shall, in the case of an official aid-funded project, be deemed to include express provision in the agreement in respect of that project for the remission of tax ("the value added tax chargeable under this Act;") on any taxable goods ("tangible movable and immovable property and includes electrical or thermal energy, gas and water, but does not include money;") or services ("anything that is not goods or money;") supplied for the implementation of the project, where the agreement was concluded before the commencement of this Act: Provided that a remission to which this subsection applies shall remain in force for a period of five years with effect from the commencement of this subsection. Section 68(5) Where a tax ("the value added tax chargeable under this Act;") was due to be paid or refunded under the repealed Act but was not so paid or refunded, it shall be paid or refunded as though it were a sum due under this Act. Section 68(6)(a) revive anything not in force or existing at the time at which the commencement take effect; Section 68(6)(b) affect a penalty, forfeiture or punishment incurred in respect of an offence committed against the repealed Act in force at the commencement of this Act; Section 68(6)(c) affect an investigation, legal proceedings or remedy in respect of a right, privilege, obligations, liability, penalty, forfeiture or punishment, and any such investigation, legal proceedings or remedy may be instituted, continued or enforced and such penalty forfeiture or punishment may be imposed as if this Act has not been passed; or Section 68(6)(d) affect the employment or appointment of any person ("an individual,company, partnership, association of persons, trust, estate, the Government, a foreign government, or a political subdivision of the Government or foreign government;") to the services ("anything that is not goods or money;") of the Authority ("the Kenya Revenue Authority established by();") subsisting at the commencement of this Act.