A couple of weeks ago the budget was read. The response on the ground was a mixed one. Even though there were winners and losers, for the most part, questions were rife in the minds of the citizens. Does the landlord tax mean my rent will go up? Is there to be a reduction to any of my everyday commodities now that there have been import tax reductions in some areas, and complete elimination in others? We managed to catch up with Benji Ndolo, the director at the Organization for National Empowerment*(ONE) and got his views on the matter. This is what he had to say:
The big and flowery Kenyan budget misses the point in various ways. For all its largesse at a record Ksh 1.4 TRILLION, most Kenyans are broke, unemployed and underemployed. In business, things are tough, with punitive taxation, a harsh environment where corruption is rife and security is non-existent. Of course business also suffers when Kenyans have no spending power.
Harmful borrowing – What are the terms on which the Kenya Government is taking long term loans on behalf of her people? For how long? Is it possible we will be in debt for the next 50 years for projects of whose use most Kenyans do not know or see?
Lack of good sense – Rather than hide behind statutes and perform mechanical jurisprudence, leadership needs to adopt strategies that are well meaning and sensible to empower Kenyans and alleviate poverty. To give a 4 month window in which fertilizer is subsidized only allows brokers and traders to buy cheap, hoard and turn around selling back to the poor small scale farmer. These types of gimmicks will ensure the country maintains a ridge between the haves and the have-nots. We need to CRIMINALIZE corruption, quick.
Interest Rates – are too high and unexplainable since risk analysis shows that 90% of consumer borrowers do pay back their loans. Directives by Central Bank have previously been ignored. This can’t be right.
Rental income is INCOME. As such it was always liable to tax. How is it for decades landlords inKenya have been allowed to collect colossal sums of money tax-free? Bringing them into the net does NOT mean increasing rent on already burdened tenants.
Tax Regime – From income tax, to duty and VAT and excise duty on air time the average Kenyan is broke because he pays so much in taxes and at every corner that he has little to spend and even less to put away. I challenge you to carefully consider the taxes you pay on daily purchases from food to fuel to airtime and electricity. It is shocking!
Devolution -The best example of why this system of governance is needed in earnest is the Kenyatta National Hospital. This hospital is badly congested today. The reason is that almost everybody in Kenya comes directly there for treatment because there are no credible clinics, dispensaries and hospitals in their home areas. So instead of being a level 5 referral hospital, it is the emergency hospital for the accident victim on Kenyatta Avenue as well as the cancer screening facility for the patient from Kerugoya. We need to set up infrastructure speedily in the counties to de-congest the capital city and help so called rural areas come alive. There is no reason why the country’s resources, brains and bodies should all be centered inNairobi.
*The Organisation for National Empowerment is a civil society lobby group based in Nairobi, Kenya.