Removal of Excise Duty on SACCO Transactions Among Proposals Tabled to Treasury by KUSCCO

Savings and Credit Cooperative Organisation (SACCO) members could soon experience tax relief if new proposals submitted to the National Treasury are approved.

In submissions made to the Treasury by the Kenya Union of Savings and Credit Co-operatives (KUSCCO) on Thursday, March 19, the union called for the removal of excise duty on SACCO member-based transactions.

This measure is expected to reduce the cost of accessing financial services within SACCOs, making it cheaper for members to save, withdraw, and borrow funds.

KUSCCO argued that taxing internal SACCO transactions placed an unnecessary burden on members, many of whom are low- and middle-income earners.

By eliminating the excise duty on SACCO transactions, it is expected that members will retain more of their money and improve their financial well-being.

“Today, KUSCCO, acting on behalf of the SACCO movement, appeared before the Treasury to present and defend sector proposals for the 2026/2027 national budget,” KUSCCO announced.

“The oral submissions, delivered at the Treasury Building in Nairobi, marked a moment for SACCOs to articulate their priorities in Kenya’s fiscal policy process,” it added.

Another major recommendation made by KUSCCO to the Treasury was on adjusting individual income tax bands. 

The proposal seeks to ease the pressure on taxpayers by increasing their disposable income, which could, in turn, boost savings and investments within SACCOs.

In its submission, KUSCCO also proposed the definition of ‘designated primary cooperative societies’ to include groups of individuals and corporates in a move aimed at increasing participation in the cooperative sector.

By widening the eligibility, SACCOs will be able to attract more members, further boosting the cooperative sector growth and competitiveness against other institutions such as banks.

“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.

The submission process was supported by audit firm PwC, which provided technical expertise in developing and refining the proposals.