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{
    "id": 1001002,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1001002/?format=api",
    "text_counter": 235,
    "type": "speech",
    "speaker_name": "Amb. Ukur Yatani",
    "speaker_title": "The Cabinet Secretary, National Treasury and Planning",
    "speaker": null,
    "content": "The telecommunication sector provides good opportunities for innovations, particularly for our youth. In order to stir growth in this sector and encourage local investment, inputs for assembly or manufacture of mobile phones will be imported duty free under the East African Community Duty Remission Scheme. The leather and footwear sector has capacity for manufacturing footwear considering we have adequate raw materials. It is important for this sector to be protected from cheap imported products in order to encourage investments in the sector. In this regard, we have maintained the specific rates of duty in addition to 25 per cent duty rate which were granted last year. This will also safeguard Government revenues by curbing undervaluation of such imported products. There is need to protect local producers of electrical parts and accessories. In this regard, we shall be applying the Import Duty rate of 35 per cent instead of 25 per cent on such products for one year. The East African Community region has agreed to grant duty remission on raw materials and inputs for manufacture of masks, sanitisers, ventilators and personal protective equipment including coveralls and face shields. This will enhance measures aimed at containing COVID-19 in addition to encouraging local production of such products. As a long-term measure, the East African Community region has agreed to amend the East African Community Customs Management Act to exempt from Import Duty supplies for diagnosis, prevention, treatment, and management of epidemics, pandemics and health hazards to deal with any future occurrences of such nature. The Government introduced a simplified monthly Rental Income Tax in 2016 to enhance tax compliance. Under this regime, the rental income is taxed at the rate of 10 per cent for individuals earning annual rental income of Ksh10 million and below. The Kshs10 million per annum threshold has brought positive impact on tax compliance. I therefore propose to raise this threshold to Kshs15 million per annum in order to bring more landlords to the simplified regime. Some companies continue to declare losses year in year out hence not contributing to the Exchequer in terms of tax revenue. However, these companies enjoy facilities such as infrastructure whose cost of construction and maintenance is serviced by the Government through tax revenues contributed by other patriotic taxpayers. In order to ensure all taxpayers, contribute to the construction and maintenance of our infrastructure, I have proposed to introduce a minimum tax that will be payable by all companies at the rate of one per cent of their gross turnover. With the fast advancement in technology, many business transactions are increasingly being carried out through digital platforms. In some cases, due to the nature of the transactions, it is difficult to effectively tax the income derived through such platforms. It is, therefore, necessary to provide a framework that will facilitate taxation of such income. In this regard, I propose to introduce digital service tax on the value of transactions at the rate of 1.5 per cent. Food security is one of the pillars of the Big Four Agenda. The Government has put measures to support its implementation including food production. To further this Agenda, I propose to exempt maize or corn seeds from the Value Added Tax (VAT). This is to make them affordable to our farmers. Further, I have proposed to exempt ambulance services from VAT in addition to medical, nursing and dental services which are currently exempt from VAT to cushion Kenyans from the high costs of such services. To enhance tax compliance, I propose to introduce a voluntary disclosure programme to allow Kenyans who, in the last five years, may have inadvertently made omissions in their tax returns to voluntarily disclose such omission and pay the tax due. The programme will run for three years. In order to encourage uptake of this programme, I further propose to grant relief for penalties and interest in respect of the tax disclosed after payment of the principal tax. The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
}