Nairobi, June 18 -- The National Assembly's Departmental Committee on Finance and National Planning has differed with the National Treasury over a proposal to empower the Kenya Revenue Authority (KRA) to deem a prescribed threshold of undistributed income as distributed dividends to shareholders and, therefore, subject the same to Withholding Tax.

Whereas the National Treasury proposed to amend Section 24 of the Income Tax Act and adopt a minimum of 60 percent as the threshold for deemed dividend distribution, the committee is now proposing that the same be placed at a maximum of 40 percent.

The two proposals differ not just on the proposed thresholds but more significantly on the fact that whereas the National Treasury is proposing ado...