Members of Savings and Credit Cooperative Organisations (SACCOs) could soon enjoy significant tax relief if proposals presented to the National Treasury are adopted in the upcoming 2026/27 national budget. The Kenya Union of Savings and Credit Co-operatives (KUSCCO) has urged the Treasury to scrap excise duty on member-based transactions, arguing that the levy unfairly penalises ordinary savers.
Appearing before Treasury officials at the Treasury Building in Nairobi ealier, KUSCCO said the removal of excise duty would lower the cost of accessing financial services within SACCOs, making it cheaper for members to save, withdraw, and borrow. The union stressed that most SACCO members are low- and middle-income earners, and taxing only internal transactions would only deepen their financial strain.
“Eliminating excise duty will allow members to retain more of their money and strengthen their financial well-being,” KUSCCO noted in its oral submissions, adding that the proposals were grounded in the real challenges faced by cooperatives across the country.
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Beyond excise duty, KUSCCO also called for adjustments to individual income tax bands. The union argued that easing the pressure on taxpayers by expanding tax brackets would increase disposable income, which in turn could boost savings and investments within SACCOs.
Another major recommendation was to redefine “designated primary cooperative societies” to include groups of individuals and corporations. KUSCCO believes widening eligibility will attract more members into the cooperative sector, enhancing growth and competitiveness against commercial banks and other financial institutions.
The union emphasised that its proposals reflect the lived realities of SACCO members and urged the Treasury to adopt them to ease the tax burden. “During the submissions, we emphasised that the proposals are grounded in the real challenges faced by SACCOs and urged the National Treasury to adopt them to ease the tax burden on SACCOs,” KUSCCO affirmed.
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If approved, the reforms would mark a decisive step toward greater economic empowerment.
By Masaki Enock
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