The Cabinet has approved the proposed Finance Bill, 2025.
In a Cabinet meeting chaired by President William Ruto at State House on Tuesday, April 29, 2025, Cabinet Secretaries approved the bill, which focuses primarily on closing loopholes and enhancing efficiency.
The bill also seeks to address loopholes related to tax expenditures that have historically been exploited to syphon funds from public coffers, such as through inflated tax refund claims.
“In furtherance of these objectives, Cabinet also approved the Finance Bill, 2025, which focuses primarily on closing loopholes and enhancing efficiency, including addressing loopholes related to tax expenditures that have historically been exploited to siphon funds from public coffers, such as through inflated tax refund claims,” a dispatch from the Cabinet meeting read in part.
Finance bill 2025 provisions
The bill further seeks to minimise tax-raising measures by enhancing tax administration efficiency through a new legislative framework.
It also aims to streamline tax refund processes, seal legal gaps that delay revenue collection, and reduce tax disputes by amending the Income Tax Act, VAT Act, Excise Duty Act, and the Tax Procedures Act.
“Importantly, the bill seeks to minimise tax-raising measures. Instead, it aims to enhance tax administration efficiency through a new legislative framework. Key provisions include streamlining tax refund processes, sealing legal gaps that delay revenue collection, and reducing tax disputes by amending the Income Tax Act, VAT Act, Excise Duty Act, and the Tax Procedures Act,” the communique read.
“Notably, the Bill proposes critical changes to support small businesses, allowing them to fully deduct the cost of everyday tools and equipment in the year of purchase, thereby eliminating unnecessary delays in accessing tax relief.”
Finance Bill 2024
This comes almost a year after the defunct Finance Bill 2024 was rejected by Kenyans.
The bill which sought to introduce a raft of tax measures was withdrawn by President Ruto following deadly protests that were led by Gen Z.
As a result, the head of state opted for austerity measures to meet the financial obligations of the 2024/2025 financial year.