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Fair taxation is missing catalyst for savings and stronger saccos in Kenya
Countries such as India, Spain and the Philippines base tax treatment on the nature of cooperative activity rather than on the identity of members. Similar economic activities, after all, should generally be treated similarly. The same principle applies to excise duty on member-based fees.
The budget-making process for the 2026-27 financial year has ended. Once again, as in previous years, proposals aimed at aligning the tax treatment of savings and credit cooperative societies (saccos) with their unique cooperative character were not considered in the final framework.
That is, of course, the prerogative of policymakers. Budget-making involves trade-offs and competing national priorities. However, this outcome presents an opportunity to step back and interrogate the tax environment.
