Men will not be responsible for wives’ taxes in proposed Finance Bill, 2024

Currently, in case a wife fails to remit income tax, the man shoulders the responsibility, including paying fines or being jailed.

In Summary
  • The proposed change is a clean-up provision to reflect societal changes where everyone is liable for their taxes.
Image: STAR

Men will not be legally responsible for their wives' income tax obligations if a 50-year law is repealed.  

The Finance Bill, 2024 tabled last week in the Parliament proposes to delete the definition of a wife’s employment, income, professional, and self-employment income rate from the Act. 

The proposed change is a clean-up provision to reflect societal changes where everyone is liable for their taxes.

The country is currently relying on a 50-year-old law that recognises wives as dependants of their husbands.

This means that in case a wife fails to remit income tax, the man shoulders the responsibility, including paying fines or being jailed. 

"It presupposes that the income of a married woman living with her husband is the income of the husband for purposes of ascertaining his total income and is therefore assessed on that basis and the tax thereon charged,'' tax experts at Bowmans say in a Finance Bill, 2024 analysis. 

To bring more people into the tax bracket and cut debt dependency, President William Ruto's government has proposed a repeal of the law that has been in operation since 1974. 

The proposal has elicited mixed reactions across gender, religious and cultural orientations. However, the majority agrees that the law is time-bad. 

"The contentious legislation that requires husbands to pay taxes for their wives' failure to which they face some austere consequences, does not apply to the 21st-century men and women,'' gender parity crusader and lawyer, Joyce Memo told the Star. 

"We cannot purport to pursue gender equity when our laws are curtailing the effort."

According to the current law, if a man does not remit his wife’s tax within the required period, a 20 per cent fine is due, allowing the Kenya Revenue Authority (KRA) to hunt him down.

Memo adds that Kenya has made great strides in the line of narrowing the economic, political and social divide between the two genders.

"The Kenyan constitution of 2010 contains well elaborate provisions that promote gender parity. It provides for at least a third of either gender must be represented in positions of leadership. The 1974 law is a clear  contradiction."

Her sentiments are echoed by Belamy Ng'eno, an insurance agent in Nairobi who insists that everyone should carry his or her cross. 

"Why should a man be liable for his wife's tax obligations in 2024? That draconian law must be scrapped given gender equity talks. I bet most men are not aware of this,'' Ng'eno told the Star.

Irene Mwangi, a tax law partner at an international audit firm insists that the law must be repealed as it creates avenues for tax avoidance. 

"Tax is an individual obligation. Why should a man be held accountable for taxes on income earned by his wife/wives? The lacuna provides an opportunity for tax avoidance,'' she said. 

Pastor Godfrey Aduvaga of a Friends Church in Nairobi is of a different opinion. 

He quotes the bible, indicating that a man and a woman become one in a marriage union, hence they should not be taxed separately. 

"Men are providers. We never saw women go hunting and gathering. While I appreciate change, the plan to repeal the law will overburden families who are already feeling the heat on many fronts,'' he said.

He is asking men to rise to the occasion and protect their families, both socially and economically. 

Daniel Muyela 65 wonders why a husband should sit around and watch his wife harassed by tax authority. 

"We must appreciate that women will never be men and vise vasa. Men must diligently undertake their provision and protection duties. Such proposals continue to devalue gender roles, destroying families and societies."

He argues that the number of divorces has become rampant, stemming mostly from financial independence. 

This kind of tax law is not just in Kenya. Several countries in the continent are working towards repealing as the gender equity voice becomes louder. 

In the 1980s, for example, several Western European countries were forced to reform their income tax systems to eliminate provisions of the law that explicitly discriminated against women.

More generally, in industrialized countries, the personal income tax system based on joint filing has given rise to a longstanding discussion over how the income tax treats the incomes of secondary earners (generally assumed to be women) and the incentives the income tax has on their work, childbearing, and other behavior.

The United Kingdom undertook a fundamental tax reform in 1990.

Before 1990, the husband had the legal responsibility to submit the return.

If the wife earned income and the couple opted for separate taxation, all nonlabor income was attributed to the husband. In 1990, the reform converted the income tax to full individual taxation.

In France, only the husband was required to sign the tax return while the wife only signed if she earned income.

This was changed in 1983 so that both were required to sign the return.

In the Netherlands, the tax-free allowance of a married man was much higher than that of a married woman.

This was changed in 1984 to an equal-sized basic tax allowance with supplemental allowances for singles, one-earner couples, and so on.

A gender bias in tax systems report by the International Monetary Fund (IMF) warns that tax gender bias is a concern, especially in the developing world.

WATCH: The latest videos from the Star