Governance Social

KRA to Start Taxing all Dowry Payments from 2022

The taxman in Kenya is on steroids and this time round, no coin will be left unturned.

Starting January 2022, Kenya Revenue Authority will start taxing all dowry payments in an attempt to check the budget deficit that has been widened by the runaway corruption in Kenya. This is also in line with the government’s policy to become an upper Middle Income Country by 2030 through increased taxation.

Walk Down the Wallet

“We have realized that a lot of money is going into dowry and this is not declared by the recipients. Our estimates show that the dowry industry is worth 365 billion shillings and we are targeting a fixed tax of 15% on this. This is way much lower than the corporate tax of 30%.”

The run on dowry is the latest attempt by the taxman in Kenya to get everyone to pay tax, arguing that young people in the 20s make a lot of money which ends up as dowry payment. The other amount is spent on weddings and plans are underway to tax this too. “By 2025, we want Kenyans to be paying 10% of their wedding expenses as tax!”

Negative Reception

The dowry tax has elicited mixed reactions with many people from Central Kenya, especially Kiambu, opposing the punitive tax. Aspiring Kiambu Senator Isaac Mwaura warned that the tax would unfairly punish daughters of Kiambu since parents will simply increase the dowry by a similar percentage to cater for the tax. “We are going to make it hard for poor men to marry in Kiambu where dowry is the highest, and you know well that poor men make the best husbands.”

In Kakamega, former Senator Bonny Khalwale warned that the tax would be an exercise in futility since most people are not paying dowry in cash, but in cows and other animals. However, KRA is working on the logistics to get their share of the cows or any other physical goods. “If the dowry is 10 cows, it should be obvious that one cow belongs to KRA and it is the prerogative of the recipient to deliver the cow to our local offices.”

Other monies that the taxman hopes to target in the near future include bribes, church offerings and money collected by beggars on the streets.