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COMMISSIONER OF DOMESTIC TAXES (LARGE TAX PAYER OFFICE) V. BARCLAYS BANK OF KENYA LTD

(2020) JELR 103113 (CA)

Court of Appeal  •  Civil Appeal 195 of 2017  •  6 Nov 2020  •  Kenya

Coram
Wanjiru Karanja Fatuma sichale Kathurima M'inoti

Judgement

JUDGMENT OF THE COURT

The crux of this appeal is whether withholding tax is payable by a bank for payments it has made to credit card companies and to other banks that issue credit cards. The respondent, Barclays Bank of Kenya Ltd, a limited liability company licensed to carry on the business of banking and financial services, is a member of networks established by three credit card companies, namely, Visa International Services Association, MasterCard, Inc., and American Express Ltd. The arrangement enables the respondent to issue its customers with credit, debit, and pre-paid cards, which the customers use to pay for services and goods purchased from contracted retail outlets. In turn the respondent has entered into agreements with the outlets to accept payments through the cards.

On 27th December 2012 and 21st January 2013, the appellant, the Commissioner of Domestic Taxes demanded from the respondent payment of withholding tax on payments that the respondent had made to the three ca…

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