Experts Want Kenya Kwanza to Curb Insatiable Tax Appetite
The fiscal policy proposals of the Kenya Kwanza administration have faced criticism for their heavy reliance on taxation as a means of generating revenue.
At Bomas of Kenya, the National Dialogue Committee convened an open discussion on the rising living costs with economic experts as panellists. Those on the committee voiced consensus on tax hikes, overestimated budgets, and deficient Foreign Direct Investment (FDI) as the cause for soaring costs. The committee gleaned input from several specialists in relevant fields among them being Controller of Budget Margaret Nyakang'o, Chief Executive Officer of the Institute of Economic Affairs Kwame Owino, and officials from the Parliamentary Budget office.
The committee, led by Wiper leader Kalonzo Musyoka and National Assembly Majority leader Kimani Ichung'wah heard from experts who raised concerns about the negative impact of increased VAT and excise duty on the spending power of Kenyans. Nyakang'o expressed concern that low-income earners, comprising the majority of Kenyans, are unfairly burdened by the current tax structure. There are fears that this could worsen the existing economic crisis. The committee also discussed President William Ruto's overseas trips and their potential effect on Foreign Direct Investment (FDI).
Based on the expert analysis, the President's travels abroad won't contribute significantly to FDI, especially given the current economic instability. The Parliamentary Budget Office officials shared a sombre forecast, citing how larger economic players in the area are thriving due to infrastructure investments, and steady political conditions with noticeable progress in infrastructure-based projects such as railways and gas plants. Dr. Martin Masinde, the acting director of PBO, attributed the depreciation of the Kenyan shilling to excessive reliance on imports and limited exports.
To combat these challenges, Mr. Owino from the Institute of Economic Affairs suggested implementing tax reliefs, VAT exemptions, subsidies on essential goods, and increased social protections. Additionally, he proposed the elimination of the housing levy and a nationwide school infrastructure program to ensure equal resource distribution and create employment opportunities. Mr Owino also called for a reduction in unnecessary spending by both national and county governments.
Comments (6)
" Dr. Martin Masinde, the acting director of PBO, attributed the depreciation of the Kenyan shilling to excessive reliance on imports and limited exports."Simply put, more money/dollars are going out of the country,and less coming in.Terrible situation to be in.To make it even simple,imagine living on debts?
This situation can easily be remedied by consuming more of what we produce,and less on what we get from out siders.All these big luxury cars,and complicated gadgets cost alot of dollars to bring into the country for afew wealthy Kenyans.
Thanks to diaspora monthly remittance.This situation could be worse.
Overtaxing wananchi is not the solution.We have to be creative enough to produce goods that can compete in the international market. Carvings,and other artifacts are not enough...
Yes there is high consumption. By the elite and bloated political machinery. The country is bankrupt from excessive borrowing, even more excessive spending, virtually no governance. Its a dog eat dog situation in Kenya so it's unsustainable. Diaspora folks, please invest where you have invested of investing or wasting your hard earned sweat....after all you'll even be taxed for visiting...taxed for setting....mugged for being around....fleeced, conned etc...all forms of direct and indirect taxation...
Yes there is high consumption, by the elite and the bloated political machinery. The country is bankrupt from excessive borrowing, and even more excessive spending, there is virtually no governance. Its a dog eat dog situation in Kenya so it's unsustainable. Diaspora folks, please invest where you are resident. Stop wasting your hard earned sweat on investments that cause you hardship and potential danger when you relocateor return....after all you'll still be taxed for visiting...taxed for setting....mugged for being around....fleeced, conned etc...all forms of direct and indirect taxation...live well and dignified where you resident.
Whoever is advising Ndugu Samoei about excessive taxation is dead wrong. Why? Look at the current population of USA composed of over 334 million people with "Help wanted" signs all over the country. Wy? Less taxation encourages ordinary people to create jobs.
US taxation is also high (add Federal, State and Local taxes), but US has accountability and efficiency. Kenya has to reduce corruption and improve on service delivery. Imagine all the power producers and transmitters depend on the corrupt and highly inefficient Kenya Power. One of these days, all of these companies will fold, only because of one.
Corruption = Rushwa katika nchi yetu
https://youtu.be/f-qc5FPsf_0?si=xo_qVEzyLECHtnzd