Kenyan Parliamentary Committee Endorses Bill to Apply Capital Gains Tax on Cryptocurrencies
Summary:
The Kenyan Parliament's Finance and National Planning Committee has approved the Capital Markets (Amendment) Bill, 2023, designating cryptocurrencies as securities and introducing capital gains tax on them. The bill now advances to the National Assembly's reading phase. This measure would entail Kenyans paying capital gains on increased cryptocurrency market value when sold or utilized in transactions. Furthermore, Kenyan citizens would be mandated to disclose all their crypto assets and their Kenyan shilling value to the Kenya Revenue Authority.
The Kenyan parliamentary committee has endorsed a legislative measure that assigns securities status to cryptocurrency and requires capital gains tax. The next destination for this Bill is the lower house of parliament. As reported by the Business Daily of Kenya on 4th Dec, the Finance and National Planning Committee of the National Assembly has green-lighted the Capital Markets (Amendment) Bill, 2023. Committee Chairman, Kimani Kuria, was quoted: “This crucial legislation will protect our nation from the proceeds of illicit activities and the funding of terrorism. Cryptocurrencies are currently being used by millions of Kenyans, yet we lack legislation to regulate it. This Bill has our endorsement for printing.” Following committee endorsement, the bill progresses to the reading phase in the National Assembly, the Parliament of Kenya's lower house.
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The Capital Markets (Amendment) Bill, 2023, alters the tax code of the country, levying taxes on cryptocurrencies held in digital wallets and on crypto exchanges. Kenyans will be required to pay capital gains on increased crypto market value when it is sold or used in a transaction, according to the framework of this bill. Though the complete text of the bill is not accessible, Business Daily reports, "banks will deduct 20% excise duty on all commissions and costs charged on transactions."
Upon the adoption of this bill, Kenyan citizens will be legally bound to disclose all their cryptocurrency holdings and their value in Kenyan shillings to the Kenya Revenue Authority. The bill includes: “Anyone possessing or dealing in digital currency must provide the Authority with the transaction’s proceeds, any related costs, and any gain or loss on the transaction for taxation purposes.”
Kenya looks poised to introduce cryptocurrency taxation. Meanwhile, tax authorities in various countries are increasingly pushing to identify cryptocurrency holders who have inaccurately reported their holdings. Recently, the United Kingdom's His Majesty's Revenue and Customs agency called on UK holders to properly report any undeclared cryptocurrencies for the past four, six, or even 20 years.
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Published At
12/5/2023 3:24:04 PM
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