Ride-hailing firm, Bolt has asked Parliament to delete Section 23A of the Tax Procedures Act to exempt ride hailing firms from generating the eTIMS invoices.
Ride-hailing firm, Bolt wants Parliament to exempt it from provisions of the Tax Procedures Act that requires the industry to generate real-time electronic tax information management system (eTIMS) invoices for each ride.
Bolt told the National Assembly's Finance and National Planning committee that ride-hailing platforms process millions of transactions daily and generating real-time eTIMS for each ride poses performance issues.
George Abasy, Bolt Public Policy Manager told lawmakers that the industry involves multiple parties — passengers, independent drivers and the platform owners.
"Implementing ETIMS in this tripartite arrangement is complicated. We also note, the Kenya Revenue Authority is currently unable to provide a workable solution to capture the complexity in the industry all this time after eTIMS was implemented in 2024," Mr Abasy said.
Challenging proposal
"We also note, the Kenya Revenue Authority (KRA) is currently unable to provide a workable solution to capture the complexity in the industry all this time after eTIMS was implemented."
Appearing before the committee chaired by Molo MP Kuria Kimani during the public participation on the Finance Bill, 2025, Bolt asked MPs to delete Section 23A of the Tax Procedures Act to exempt ride hailing firms from generating the eTIMS invoices.
Mr Abasy wants the electronic tax invoice to exclude payments of emoluments, payments for imports, payments of interest, transactions for accounting for investment allowances, airline passenger ticketing and payments subject to withholding tax that is a final tax.
"The current wording of the legislation brings to the ambit of eTIMS the invoices issued in the ride-hailing industry. However, certain complexities in the industry make this a challenging proposal to implement practically," Mr Abasy said.
"Ride-hailing platforms process millions of transactions daily. Generating real-time eTIMS for each ride poses performance issues. The industry involves multiple parties—passengers, independent drivers and the platform owners."
Mr Abasy appealed to the committee to include the term “payments made to players in the ride hailing and food delivery industry.”
"The updated Section 23A of the Tax Procedures Act is amended by deleting subsection (4) and substituting therefore the following new subsection - (4) the electronic tax invoice referred to in subsection (3) may exclude payments of emoluments, payments for imports, payments of interest, transactions for accounting for investment allowances, airline passenger ticketing and payments subject to withholding tax that is a final tax and payments made to players in the Ride hailing and food delivery industry."
He said the ride hailing industry in Kenya has experienced significant growth and transformation over the past few years, driven by factors such as urbanisation, smartphone and network penetration and it offers convenient solutions.
Mr Abasy said the industry is regulated by National Transport Services Authority (NTSA) including pricing among others.
A Bolt boda boda rider pictured along Ngong Road on April 19, 2025.
"The industry in Kenya includes cars, boda bodas and tuk tuks. Over 70 per cent of drivers operating rent their vehicles from third party owners. The drivers are mostly in the 18 to 35 demographic age group," Mr Abasy said.
Bolt said it has engaged the KRA over the past one year to address the issue of electronic tax invoices arguing its 20,000 drivers on the road are unable to generate the invoices since they do not interface between the app and the ride hailer.
"We have almost 10,000 or 20,000 drivers on the road. The law says when you alight, you are expected to issue an eTIMS invoice to the customer. Our drivers are not able to interface between the ride hailer and the app owners," Mr Abasy said.
"We are asking you to exclude Bolt because of the complexity of integrating almost 15 customers per driver in a day. You drop and pick. Exclude us until such a point when the issue of eTIMS is solved."
Committee chairperson Mr Kimani said the KRA will be invited on Wednesday to shed light on the problem in integrating its systems with those of the ride hailing firms.
Keses MP Julius Ruto demanded to know the problem facing ride hailing companies in the issuance of electronic tax invoices given that they are not operating on manual platforms.
"You are not manual, the system is integrated and is online. Why not issue the eTIMS automatically. Why not link your system with that of KRA?" Mr Ruto asked.
Kitui Rural MP David Mboni ruled out the possibility of excluding Bolt from issuing electronic tax invoices saying multinational firms should pay taxes to the KRA like local firms.
"If you are excluded from the issuance of electronic tax invoices, it means you will not pay taxes. We will not give that exemption. Configure and integrate your systems with that of KRA," Mr Mbobni said.
Pass costs to their customers
Bolt also asked MPs to review the imposition of value added tax (VAT) on various electric solar products as outlined in section 36 of the Finance Bill, 2025.
The said section of the Bill seeks to impose 16 per cent VAT on the supply of motorcycles and supply of electric bicycles. Bolt said the imposition of tax will see boda boda riders pass the costs to their customers.
"The reclassification of the goods from zero-rated to exempt means that local assemblers and manufacturers will lose the ability to claim input VAT on costs incurred in producing the goods," Cecilia Kuria, Bolt Africa Tax Manager said.
"The main expected consequence is that local assemblers will be unable to seek refunds for input VAT related to such supplies and they will be likely to pass these costs over to the consumers."
Ms Kuria said Bolt provides significant livelihood opportunities for people who would otherwise not have significant prospects. She said the Bolt boda boda category is one of the fastest growing categories due to the affordability of electric motorcycles in the country.
"This proposed change is likely to reverse this as it will increase the barriers to entry. This change will make electric motorcycles more expensive resulting in barring out a vulnerable proportion of the population without much economic prospects," Ms Kuria said.
Bolt further appealed to lawmakers to delete section 52 of the Finance Bill, 2025 which seeks to amend section 59 of the Tax Procedures Act that protects trade secrets and personal customer data from unnecessary government access.
"This erosion of privacy undermines public trust in regulatory bodies, potentially discouraging participation in digital ecosystems. The proposed deletion contradicts key data protection principles such as data minimization and purpose limitation, as enshrined in global standards," Mr Abasy said.
"Allowing the Commissioner General for KRA to demand unrestricted data access opens the door to over-collection, misuse, or mission creep, increasing the risk of data breaches, unauthorised profiling, or surveillance."
Bolt also asked the committee to amend section 12E(3)) of the Income Tax Act which introduced a 3 per cent tax known as significant economic presence tax that shall be payable by a non-resident person whose income from the provision of services is derived from or accrues in Kenya through a business carried out over a digital marketplace.
Mr Abasy said the Significant Economic Presence (SEP) of 3 per cent replaced the Digital Services Tax (DST) of 1.5 per cent representing a 100 per cent increase in the applicable tax rate, which is significantly high.
He said the tax increase has limited the investment in the industry hence limiting the demand for ride hailing services.
"We have seen a significant drop in new customers sign-ups as there has been erosion in investment which is necessary to stimulate demand. While the expectation was that the doubling of the rate from 1.5 per cent to 3 per cent would result in double the tax paid, the reality is that the increase in the tax payable was lower than expected on a constant growth basis."
"Our proposal is that section 12 (E)(3) be amended to read-For the purposes of computing the tax under subsection (1), the taxable profit of a person liable to pay the tax shall be deemed to be five per cent of the gross turnover."
