In a powerful show of unity, the Kenya Private Sector Alliance (KEPSA) has stepped forward to push for sweeping tax reforms under the looming Finance Bill 2025, sending a clear signal to policymakers: it’s time to put enterprise at the heart of Kenya’s economic strategy.
KEPSA’s proposals aim to do far more than tweak tax rates — they seek to rewrite the rules of engagement between government and business. At the core of their demands are three pillars: industrial resilience, tax efficiency, and deepened private sector participation in national planning.
Their argument is simple but potent: without a vibrant, unshackled private sector, Kenya’s grand development plans are little more than expensive illusions.
In a climate where businesses are grappling with high operational costs, uncertain regulations, and sluggish growth, KEPSA is warning that only bold, strategic tax reforms can unlock real industrial strength.
Among the key measures being championed are:
• Lowering corporate tax rates for small and medium enterprises (SMEs) to boost formalization and growth.
• Streamlining VAT refund processes, which have become a cash flow nightmare for businesses large and small.
• Introducing investment-friendly tax incentives targeting manufacturing, green energy, and digital economy sectors.
• Anchoring regular public-private consultations in law, to ensure businesses are not treated as afterthoughts in economic policymaking.
Behind the urgency is a stark reality: Kenya’s cost of doing business is steadily eroding its competitiveness within the East African region.
Recent surveys by the World Bank and local think tanks paint a worrying picture — investors are increasingly choosing Rwanda, Ethiopia, and even Tanzania for their friendlier business environments.
KEPSA’s intervention comes at a time when the government is desperate to grow revenue without stifling growth.
However, the business community is warning that overreliance on punitive taxes and arbitrary levies is a recipe for economic strangulation, not expansion.
In championing a smarter, pro-growth tax policy, KEPSA is not just advocating for its members — it is making a broader call to secure Kenya’s economic future.
Whether Treasury officials will listen — or retreat to the familiar comfort of short-term revenue fixes — remains to be seen.
One thing is clear: if Kenya is serious about building a globally competitive economy, it must stop treating its private sector like a cash cow — and start treating it like a partner in progress.
