Kenyan Man Moves To Court, Wants Churches And Mosques Compelled To Pay Taxes

• Doctor Benjamin Magare argued that specific clauses in the Income Tax Act Cap 470 violated constitutional principles related to fairness and equity in taxation
• He claimed the clauses created a closed group of individuals and entities exempt from income tax contrary to Article 201(b)
• Earlier, Justice David Majanja stopped the Kenya Revenue Authority (KRA) from demanding tax on tithes, offerings and donations

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A Kenyan doctor has submitted a petition questioning the legality of an income tax exemption policy, which he alleges is illegal, irregular, and discriminatory.

Why Benjamin Magare wants churches to pay taxes

Benjamin Magare wants churches, mosques, and other religious institutions to be compelled to pay income tax.

In a petition filed at the Milimani High Court in Nairobi, the medic expressed reservations regarding specific clauses in the Income Tax Act Cap 470, contending that they violate constitutional principles related to fairness and equity in taxation.

"Article 201(b) of the constitution makes it mandatory that the taxation burden should be shared fairly," he argued.

Magare said sections 3(2) and 13 of the Income Tax Act created a closed group of individuals and entities exempt from income tax contrary to Article 201(b).

"That this action has allowed the so-called "exempteers" the likes of churches, mosques, temples, some NGOs, some donation groups and individuals making billions of money to benefit from this loophole to the detriment of other Kenyans who are toiling to pay their taxes. Tithes, offerings and donations are not taxed courtesy of this provision," Magare asserted.

He asked the court to rule on the issue as a matter of public interest.

Why court stopped KRA from demanding tax on tithe

In June 2022, the High Court stopped the Kenya Revenue Authority (KRA) from demanding tax on tithes, offerings and donations.

Justice David Majanja ruled that tithes, offerings and freewill donations should not be subjected to income tax as he upheld the Appeals Tribunal's ruling, which barred the taxman from demanding KSh 5.5 million tax from Thika Road Baptist Church.

“I, therefore, find and hold that since tithes, offerings and freewill donations are not income chargeable with income tax, it was not necessary for the church to seek an exemption,” Justice Majanja ruled.

Earlier, Bondo Anglican Church of Kenya (ACK) Diocese Bishop David Kodia warned KRA against expecting any taxes from churches.