MPs reject proposal to give KRA access private data

Hon. Kimani Kuria - Chairperson, Parliamentary Committee on Finance and National Planning speaking during a public dialogue on the Post-Tax Amendment Laws Analysis Forum in Nairobi. [Wilberforce Okwiri, Standard]

Lawmakers have backed proposals by the National Assembly Committee on Finance to amend contentious clauses in the Finance Bill, 2025.

One of the targeted changes is the Kenya Revenue Authority's proposal to have unfettered access to private data and trade secrets in a bid to increase revenue collection.

The proposal seeks to empower KRA to compel institutions such as banks, digital platforms and mobile service providers to disclose sensitive personal and commercial data, including financial records and trade secrets, without notifying the taxpayer.

Yesterday, MPs lauded the Bill as progressive as it did not increase taxes like the previous ones.

But the House agreed on the need to do away with the proposal to grant KRA sweeping access to taxpayers' data, terming it an overreach.

Committee Chairman, Kimani Kuria, explained that Clause 52 of the Bill fails to meet the constitutional standard set under Article 31 (c) and (d) of the Constitution, which guarantee the right to privacy.

"The committee also noted that the Data Protection Act of 2019, Section 51 sets out clear and limited grounds under which access to personal data may be exempted from certain protections. Furthermore, Section 60 of the Tax Procedures Act already provides the commissioner or an authorised officer with sufficient powers to obtain necessary information for tax administration subject to court issued warrants. This safeguard strikes a balance between tax enforcement and protection of individuals," he said.

Kuria stated that unlike previous Finance Bills, this year's was not merely a revenue-raising tool but a policy-making instrument.

"Its central focus is to enhance tax revenue collection through strategic administrative reforms and improve tax payer compliance. Rather than introducing new taxes, the Bill proposes the simplification of existing tax laws to make them clearer, more predictable and accessible to all tax payers," he argued.

"The Finance Act of 2022 had a projected revenue of Sh22 billion, the Finance Act of 2023 had Sh211 billion, the Finance Bill of 2024 had intention to raise Sh244 billion, the Tax Laws Amendment Act Sh449 billion but the Finance Bill of 2025 only Sh25 billion."

The committee further sought to assure Kenyans that the reforms introduced in the current Bill are aimed at curbing tax evasion, expanding the tax base and ensuring that all eligible tax payers contribute their fair share.

"These policies aim to ensure predictability and sustainability within the tax system, thereby fostering more environment for business... The Finance Bill embodies the government's commitment to modernizing tax administration and fostering a culture of trust and corporation between the Kenya Revenue Authority and the citizens."

Kitui Central MP Makali Mulu called for a predictable tax regime.

"If we want to get this journey right, we must broaden the tax base. We must also seek the tax leaks and have a predictable tax regime in this country so that in 10 years I know what the tax regime will look like," he said.