The Consumer Federation of Kenya is seeking to stop the KRA from collecting property taxes from landlords as it had been proposed in the Budget speech read by Njeru Githae last week. This move to charge tax on rental income is anticipated to increase the household expenditure, with landlords pushing the extra cost to tenants.

Opposing this move together with the Consumer Federation of Kenya are the Central Organisation of Trade Unions and the Institution of Surveyors of Kenya. Francis Atwoli, the secretary general of COTU says that taxing landlords would be double taxation as they are already paying land rates to local authorities.

The bodies want this move suspended until mapping of rental properties is completed to bring the Treasury to terms with the residential rental market. They also want suitable measures to protect the tenant put in place.

Njeru Githae, commenting on the anticipated rent increment yesterday said that it would be a criminal offense for landlords to increase house rents. Njeru also mentioned that this was no news to landlords, and that his move was merely an implementation of a law that has been in existence for quite some time, and that failure to implement has been losing the government revenue.

This is not the first time landlords have been asked to pay property taxes. In 2005, Kenya Revenue Authority (KRA) announced plans to use bank accounts to start taxing landlords but the move failed after banks refused to cooperate. In 2007 the law on property taxes came into effect, but it was also never successfully implemented. However, Githae believes that mapping residential and commercial houses will allow for implementation this time round.