Nairobi — The National Assembly's Finance and Planning Committee has declined a controversial proposal in the Finance Bill, 2025, that sought to grant the Kenya Revenue Authority (KRA) extensive powers to access personal data from third parties for tax compliance purposes.
In its report tabled in the house, the Committee cited constitutional and legal concerns, declaring the proposed measure as both unnecessary and potentially unconstitutional.
The rejected clause would have allowed the tax authority to compel entities such as banks, mobile service providers, and digital platforms to share personal and customer data directly, including trade secrets and sensitive financial records, without the knowledge or consent of the taxpayer.
"The Committee observed that the proposed provision does not meet the threshold set out under Article 31(c) and (d) of the Constitution of Kenya, which guarantees the right to privacy," the report states.
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Further, the Committee underscored that data privacy in Kenya is already governed by robust legal frameworks, including the Data Protection Act. Specifically, Section 51 of the Act outlines the narrow conditions under which exemptions to data protection may be granted, emphasizing that such exemptions must be necessary, proportionate, and lawful.
"We cannot legislate in a way that undermines the rights enshrined in our Constitution, particularly where personal privacy and commercial confidentiality are at stake. KRA already has legal channels to access relevant information. The proposal amounted to an overreach," the report stated.
The Committee also referenced Section 60 of the existing Tax Procedures Act, which it said already empowers the Commissioner of KRA or an authorized officer to access necessary data for tax administration. However, this authority is subject to judicial oversight, including the requirement of a court-issued warrant.
The Kimani Kuria-led committee called for adherence to due process and encouraged KRA to pursue compliance through existing legal mechanisms, with respect for individual rights and data protection laws.
The Finance Bill, 2025, is currently before the House for further debate and amendment.
"With these safeguards already in place, introducing a provision that bypasses judicial scrutiny would not only be redundant but would also violate basic rights," the report noted.
The proposal, initially introduced as a measure to strengthen compliance and close revenue leaks, was met with criticism from stakeholders.
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They argued that it could open the door to unwarranted surveillance, erode trust in public institutions, and harm investor confidence.
The Law Society of Kenya (LSK), along with major audit firms including KPMG, Ernst & Young, and CDH, warned that the amendment would severely compromise privacy protections and due process. In a joint submission, the group argued that the clause was unconstitutional and unnecessary, given that the Kenya Revenue Authority (KRA) already has legal avenues for accessing data through judicial channels.
"This move undermines due process and taxpayers' rights to fair adjudication," the LSK stated.
KPMG specifically raised the alarm over the proposed powers extending to situations where a taxpayer's matter was under active appeal, noting this breaches the principle of natural justice.
Civil society organizations led by Amnesty International Kenya and ARTICLE 19 Eastern Africa described the proposal as a dangerous slide into mass surveillance, warning that it echoed big brother state tendencies.
They emphasized that the exemption from the Data Protection Act, as proposed, lacked both justification and safeguards, thereby breaching Article 31 of the Constitution, which guarantees the right to privacy.
The Architectural Association of Kenya (AAK) flagged the risk to intellectual property and commercial confidentiality, noting that architects and engineers would be compelled to surrender proprietary designs to KRA, an act they argued would erode client trust and compromise professional standards.
