Senator Danson Mungatana (Tana River, UDA) has proposed a new bill that would establish the office of registrar for religious organisations such as churches, which would issue or revoke registration of religious organisations and religious leaders.
- The Religious Organisations Bill (2024) also proposes a KSh 5 million fine or 3-year sentence for churches and clergymen who do not register in compliance to the law if passed.
- Eligibility for registration of religious organisations must be supported by 25 people professing the same faith, a religious leader with a certified theology education, and a doctrinal constitution.
- The bill also mandates religious bodies to create separate bank accounts for Offerings and tithes with those for income generated from other economic activities like selling merchandise; failure to which a KSh 1 million fine or a 2-year sentence shall be incured.
“Offerings, tithes, donations, bequests, gifts granted to religious organisations and umbrella religious organisations shall only be exempt from taxation where the organisation demonstrates that such income is for purposes beneficial to society,” the bill states.
Churches will be required to file returns with the tax authority, presenting audited accounts for the financial year, bank statements, addresses of physical location, list of religious leaders that year, and a tax exemption or clearance certificate.
Mungatana’s bill attempts to clarify that the provisions listed on the income regulation clause are valid because they do not affect tithes and offerings. The senator stated that the bill was not a backdoor for introducing punitive taxes to religious organisations, but a guideline to root out rogue churches and extremist leaders out to financially exploit their congregants.
“The object of this Act is to regulate the formation and administration of religious organisations and oversee the management of these organisations, and ensure compliance to regulatory provisions,” the bill states.
Inside the Attempt to Regulate Religious Institutions
The proposals to seek out taxes from some religious and NGO activities is not a conversation Senator Mungatana has kickstarted. MPs led by Samuel Chepkonga (Ainabkoi, UDA), endorsed the Income Tax Regulations Bill (Charity Organisations and Donations Exemptions) 2024 after meeting with KRA’s top officials.
Chepkonga and his Delegated Legislation Committee said that the bill had rightfully tried to stipulate how donations to churches and other charitable institutions would be tax deductible. These attempts have roused contempt and disapproval from clergymen countrywide.
Some churches like CITAM which release financial statements record incomes hitting billions every year, with some like the Catholic church owning prime land and valuable property across Kenya. Netting these incomes into the taxable bracket is a sensitive issue that is subject for political and social fuel.
Religious leaders have condemned the bill for being too vague in its stratification of what constitutes taxable income for these organisations, as well as imposing tough rules which they say violate the freedom to worship. Majority Leader in the National Assembly, Kimani Ichung’wa (Kikuyu, UDA), has promised religious leaders that the bill will be eviscerated once brought to the floor.
The Backlash
Various umbrellas of the religious bodies have issued statements calling for the termination of the bill, citing that it is the proverbial camel that will take over the tent if not halted. According to them, the church can self-regulate itself and the state’s intrusion will be unwarranted and possibly impossible.
After the Mackenzie saga, the government was prompted to enlist the help of religious leaders in formulating legislation that would proactively prevent extremist inclinations. The move to regulate religious organisations will be a complex one because doctrines differ and prioritization of certain tenets as a template for validity will be contrary to the bill of rights.
The tax-exemption status for religious organisations in Kenya has been subject for fiery debate over the years. In January this year, a Nakuru-based doctor went to court to petition the revocation of this status. He argued that Section 13 of the Income Tax Act which exempts these entities from taxation violated the principle of fair distribution of the tax burden.
Some Kenyans are opposed to this idea maintaining that religious organisations play a huge role in advocating for social cohesion and moral development in society. Others have refuted these arguments saying that religious institutions have involved themselves in massive economic activities that should be considered taxable.
