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"id": 1478605,
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"content": "behind target by Kshs18.5 billion. The total revenue collection including Ministerial Appropriation-in-Aid for the period ending August, 2024, that is for the two months, was Kshs373.5 billion, which is 2.3 percent of GDP, against a target of Kshs403.1 billion. This recorded a shortfall of Kshs29.6 billion as shown in the table which I have provided, and I will not read the table because it is a long one. The total revenue for the period grew by 6.3 percent compared to a growth of 12.4 percent in the previous year, August 2023; while ordinary revenue grew by only 3.2 percent, if you compare to a growth rate of 9 percent in August, 2023. All the tax heads remained below respective targets. I, therefore, have provided the statistics that are on the Table there on cumulative revenue performance by August, 2024, as shown in millions. The below target performance in total revenue was on account of a shortfall in Ministerial Appropriation- in-Aid at Kshs11.1 billion and ordinary revenues, as I had indicated earlier, of Kshs18.5 billion. Mr. Temporary Speaker, Sir, under the ordinary revenue categories, import duty was below target by Kshs845 million, excise taxes was below target by Kshs4.9 billion, VAT was below target by Kshs10.2 billion, income tax was below target by at a tune of Kshs3 billion. The slower growth of ordinary revenue by 3.2 percent by August, 2024 compared with a growth of 9 percent over the same period in 2023 demonstrates the impact of slower economic activity since June, 2024. However, revenue performance is expected to bounce back going forward given the stability in the macroeconomic environment. The inflation rate is firmly under control, currently at 4.4 percent in August 2024. On the latest data from what I signed off yesterday is that our inflation has even come down to 3.6 percent. This one is below the midpoint of the target which is 5 percent for three consecutive months. If you look at the months of June, July, August and now we are at the fourth month, we are below 5 percent. This is a drop from 6.7 percent in August, 2023 and a peak of 9.6 percent in October, 2022 when we had the worst inflationary pressures in this country. The strengthening exchange rate since February, 2024 and the tight monetary policy stance by the Central Bank of Kenya (CBK) has supported the easing inflation. However, the CBK should lower the interest rate a bit so that we encourage the private sector to uptake more loans in order to create job opportunities. Again, you may over-control the base lending rate. Therefore, the CBK addressed its rate to 13 percent in order to manage inflation expectation but with the inflation remaining low, the CBK lowered the Central Bank rate to 12.75 percent from 13 percent. Given that the federal rate has even gone down, on 10th, we expect CBK to release the new rate and then, it should come down. Additionally, favourable weather conditions coupled with targeted government interventions have also led to the reduction in the cost of food production, thereby lowering food inflation. Mr. Temporary Speaker, Sir, the other question was how the economic disruption from the demonstrations coupled with the downgrade of Kenya's credit rating impacted the ability of Kenya to service her debts; and could the Cabinet Secretary explain any The electronic version of the Senate Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Director, Hansard and AudioServices, Senate."
}