April 2005

ARTICLE TOOLS

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Kenya, with about 2,300 missionaries from 30 countries, is a missionary magnet in East Africa. Suddenly high taxes could change all that.

The tax code, written in the 1970s, targets nongovernmental agencies that raise money through charitable donations. The code states that individuals shall be taxed monthly on a sliding scale ranging from 10 percent to 30 percent of the value of property, vehicles, salaries, and health benefits. Individuals who make more than $500 per month fall into the 30 percent bracket. Under the code, some missionaries would pay more in taxes than they earn in salaries.

In the past, most missionaries consulted local tax lawyers to decipher what many see as vague and confusing tax laws. Some missionaries were told they were exempt. No more.

"We've always paid some sort of taxes, just not this high," a missionary who requested anonymity said. "The bottom line is, we are liable for these taxes."

Kenyan tax laws allow government officials to recover up to seven years in back taxes. For this missionary, that means thousands of dollars. He approached the Kenya Revenue Authority and asked for tax amnesty. Officials are considering his request to pay only two years of back taxes—more than $8,000. One large organization was denied amnesty and owes more than $400,000 in back taxes.

Theories abound in the missions community on why the government is seeking to collect these taxes—everything from corruption to a simple need for more revenue. An attempt to reach an official with the Kenya Revenue Authority was unsuccessful.

The unnamed missionary is trying to get an amendment introduced before Parliament in June asking to exempt missionaries or only tax them on salaries.

In the meantime, a treasurer for one missions ...