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Foreign firms to pay capital gains tax on sale of shares in Kenya companies
The proposed changes appear closely linked to recent disputes involving the sale of Kenyan assets through offshore holding companies, including the transfer of Tullow Oil’s interests in the Lokichar oil project in Turkana.
A foreign firm selling shares in a Kenyan entity abroad will be compelled to pay 15 percent capital gains tax (CGT) under changes proposed in the Finance Bill 2026, in a move that tax experts fear could hurt Kenya’s attractiveness to foreign investors.
The Bill seeks to expand the scope of CGT by taxing gains arising from indirect transfers of Kenyan assets by non-resident firms, even where the transaction takes place offshore.
