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{
    "id": 1043561,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1043561/?format=api",
    "text_counter": 193,
    "type": "speech",
    "speaker_name": "Kipipiri, JP",
    "speaker_title": "Hon. Amos Kimunya",
    "speaker": {
        "id": 174,
        "legal_name": "Amos Muhinga Kimunya",
        "slug": "amos-kimunya"
    },
    "content": " Thank you, Hon. Deputy Speaker. I beg to second the Tax Laws (Amendment) Bill, (No.2 of 2020). From the onset, I want to commend the Committee and the Chair including the passion with which she has moved and cajoled the House to support the Committee Bill. The Committee met under very difficult circumstances and took off part of their holidays to look at these matters. Moreover, I am sure even as the Chair moves, they are still consulting on the amendments that they wish to bring because we are confident that Members will support them at the Second Reading, so that by the time we come to the Third Reading, they will be ready in good time. Tax is a fairly technical subject and we need to ensure Members are carried along. I do not want to repeat what the Chair has said. We all recognise that COVID-19 hit us hard, and His Excellency President Uhuru Kenyatta came up with several measures to mitigate against COVID-19. One of them was giving some tax relief to individuals and companies on the understanding that people required some extra disposable income to meet the emerging costs. Also companies required some tax relief so that they could re-invest what would have been taken off as profit in terms of retaining employees and expanding their plans. Moreover, a number of those companies actually did it and if you look at the results of the companies we have been showing, you will see that banks are fairly making some good profit. Globally, if you even look at the top- earners especially in the tech industry, you will find that their wealth has increased by over 67 per cent during the pandemic whilst the rest of the others have been shrinking. The implication of this is as we shielded the low-income earners by saying people earning under Kshs24,000 should not be taxed, we also gave relief to the high net worth individuals and reduced their tax burden from 30 per cent to 25 per cent. However, they have continued increasing their income because there are new opportunities that have come because of the pandemic. Some companies have gone down. Others have come up and hence as much as we want to balance, we are perhaps denying an opportunity to those high net income earners to actually contribute. You may remember even when I contributed when we reduced the VAT from 16 per cent to 14 per cent with reduction at the consumption level, at the low income earners, the income may not have been much. However, for those in the high-income bracket, those who want to buy new cars, will now be able to buy their new cars at reduced tax rate yet they were going to afford it. They were not complaining. They did not need the relief, they invested in high net worth. The consumption of single malt whiskeys at 14 per cent instead of 16 per cent has only denied the poor Kenyan who would have benefited from that 2 per cent coming into the national coffers and being used to provide some services. Therefore, the National Treasury ended up suffering. The estimate is that about Kshs172 billion may have been lost through these tax measures that we took to relieve people but it has eventually proven that perhaps we need the money more than the tax relief. If the money can come to the National Treasury, it can then be channeled towards targeted interventions; money for the poor, paying doctors, ensuring we have enough Personal Protective Equipment (PPEs), and ensuring that we would get the vaccines next year. This is so that we do not give people relief yet become unable to afford vaccines for them because they would not be able to do it. It has to be done from public coffers. In all the other countries, it was clear that tax reliefs were only short lived. In Britain, I believe the measures expired in August. In the United States, they already expired and there is now a new Bill in the Senate asking for over USD2 trillion. The question is: Should they even be giving 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."
}