Kenyan Churches Resist Moves by Government to Tax Offerings and Tithes

Kenyan Churches Resist Moves by Government to Tax Offerings and Tithes

  • A High Court in Kenya has rejected plans by Kenya's revenue agency to impose taxes on offerings and tithes by the church
  • The court ruled that offerings and tithes are freewill donations and, therefore, cannot be taxed because they are not income
  • There have been moves by Kenya and other African countries to tax churches, citing their venturing into commercial activities as reason

A move by the Kenyan revenue agency to tax church offerings has been met with stiff resistance as a High Court in the country has stopped the Kenya Revenue Agency (KRA) from taxing tithes and offerings.

According to local media, Justice David Majanja ruled in favour of a Baptist Church in Nairobi and upheld a ruling by a tax appeal tribunal which asked the church to pay N28.2 million or KSh.5.5 million in accrued taxes.

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Tithes, offerings, churches, Kenya
Churches in Kenya stops government from taxing tithes and offerings Credit: Eric Lafforgue/Art in All of Us / Contributor
Source: Getty Images

Tithes and offerings are not taxable

The High Court Justice said that since tithes and offerings are freewill donations and not income chargeable with income tax, it was important for the church to seek immunity.

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Churches in Kenya have been exempt from taxes like in most African countries. The Kenya revenue agency has claimed recently that the situation needed to change in order to enable the government to generate more revenue.

Kenya is among the top 10 African countries that generate the most income through corporate tax.

According to Business Insider, corporate tax in the country is currently at $30,000.

Churches are exempt from paying taxes and successive governments in the country have failed to enforce this and to prove that church offerings, tithes and donations amount to gains and profits.

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The Income Tax Act in Kenya exempts religious bodies and non-governmental organisations from paying taxes.

Government continues to make moves to tax churches

In the past ten years, Kenya’s treasury department has been making moves to tax churches, saying the increasing rate at which the churches go into commercial activities like hospitals and schools demand that they pay taxes.

According to Business Insider, the treasury argued that without taxation, the churches would be competing unfairly with other businesses.

Due to this, the Kenya Revenue Authority had, in 2018, demanded that the Baptist Church must pay up accrued taxes. But the church immediately opposed the demand.

It won at the tribunal and now at the High Court.

The latest ruling by Justice David Majanja comes as a major relief for many churches and is expected to serve as precedential.

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