The proposals are expected to significantly reshape pricing, trade patterns, and consumer costs if passed into law.
One of the most notable changes is in the electronics sector, where smartphones and related communication devices will attract a 25 per cent excise duty.
Under the new framework, taxation will be applied when a phone is activated rather than at the point of importation or sale.
This shift is expected to increase the overall cost of mobile devices in the country, particularly affecting imported brands that dominate the market.
In the second-hand clothing industry, commonly known as mitumba, the bill introduces a new taxation model that replaces traditional import-based levies.
A deemed profit system will be applied, where 5 per cent of the customs value of imported worn clothing, footwear, and other used items will be treated as taxable income at the point of entry.
The government says the move is aimed at widening the tax base and ensuring traders contribute income tax based on earnings from imported goods.
However, stakeholders in the sector have previously raised concerns that such measures could increase retail prices and affect affordability for low-income consumers who rely heavily on second-hand goods.
The betting and gambling sector is also facing tighter regulation under the proposed law. Winnings will now attract a 20 per cent withholding tax, while the definition of taxable deposits has been expanded.
All funds deposited into betting accounts will now be considered taxable, not just specific winnings or transactions.
This effectively broadens the tax net across the entire gambling ecosystem, increasing government oversight and revenue collection from the industry.
The Finance Bill 2026 now moves to Parliament for debate, where lawmakers are expected to scrutinize the proposals before any final approval is granted.
