On 30th of June 2020, the President of the republic of Kenya assented to the Finance Act 2020 which amended the Income Tax Act. This  introduced under Section 12D of the Act , a minimum tax (MT) at the rate of 1% on gross turnover. Consequently, the Kenya Association of Manufacturers and Kitengela Bar Owners Association petitioned the high court at Machakos through petition number E005 of 2021 to have the minimum tax annulled. The purpose of this alert is to highlight implication of the High Court conservatory order temporarily suspending implementation of minimum tax.


The order restrains KRA from the implementation, administration, application, and/or enforcement of Minimum tax pending hearing and determination of the petition.
Key takeaways by taxpayers.
1. Taxpayers are not required to pay minimum tax until the petition is heard and  thereafter determined.
2. The court agreed to hear and determine the petition before the second instalment becomes due.
3. Kenya Revenue Authority has indicated through a public notice to abide to the Order given by the High Court.
4. Taxpayers who have already paid the minimum tax will retain it as a credit in their iTax ledger pending the hearing and decision of the High Court.



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