Businesses will soon be able to use the tax credits they are owed by the taxman as Value Added Tax (VAT) refunds to offset other tax obligations if a proposal presented to President William Ruto is approved.
The President's office is also reconsidering the three-month provision in the Finance Act, 2025, regarding the verification and payment of VAT refunds, to revert it to 90 days.
The provision before, as contained in the Tax Procedures Act, indicated that the Kenya Revenue Authority (KRA) had 90 days to verify VAT refunds from businesses for payment.
However, in the Finance Act, 2025, this provision was extended to 120 days, which businesses are lamenting, as it cripples their cash flows. "That makes it a bit harder for businesses.
