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{
    "id": 1511284,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1511284/?format=api",
    "text_counter": 360,
    "type": "speech",
    "speaker_name": "Hon. Kuria Kimani",
    "speaker_title": "",
    "speaker": {
        "id": 13435,
        "legal_name": "Francis Kuria Kimani",
        "slug": "francis-kuria-kimani"
    },
    "content": "(Molo, UDA) Hon. Temporary Speaker, I beg to move that the Tax Laws Amendment Bill be now read a Second Time. This is one of the most progressive pieces of legislation the Committee of Finance and National Planning has processed. We have proposed an array of amendments that will ensure that we lower the tax burden of the people of Kenya as we maintain principles of supporting local manufacturers. One of the amendments the Committee will propose will be on the digital service tax. We have listened to Kenyans' opinions on the digital service tax. If it is not amended, the risk is that we will have, for example, an online shop in Westlands that sells phones both online and physically in their shop. If we introduce this digital service tax, it will mean that if one buys from the shop, they will not pay the digital service tax. However, they will pay the digital service tax if they order the same product online. The Committee will be recommending to shelve that to a future date. We also had a great conversation about significant economic presence. One of the amendments that the Committee will be proposing is to define what this significant economic presence is so that it is aligned with the VAT threshold of a turnover of Ksh5 million. In a bid to fight illicit brews, the Committee is proposing to change the way excise duty is charged on alcoholic beverages from volume-based to being a percentage of the alcohol content so that alcoholic beverages that will have a higher alcoholic content will attract a higher excise duty than the ones that will have a lower alcoholic content. Most importantly, we will also be extending the remission of excise duty when local products like sorghum and potatoes are used as raw materials in alcohol manufacturing, so we encourage sorghum farming and make this sector contribute to the economy. Another thing that has existed for many Kenyans is the requirement to pay withholding tax within five working days. One of the things that we are now recommending is to make all these taxes payable by the fifth of the following month to give liquidity to our businesses. There has been a lot of online discussion about tiles. One of the amendments we will recommend to this House tomorrow will be on the excise duty on tiles. The current proposal is to have a 35 per cent excise duty on tiles. That is very stiff. This means that we will increase the cost of tiles and affordable housing. So, we will be recommending amendments to that particular clause. As much as we want to support the local manufacturers, we should also ensure that we protect our affordable housing programme. We reject the proposal by the National Treasury to increase excise duty on data and airtime to 20 per cent. The status quo of the excise duty on airtime and data should remain at 15 per cent to encourage the uptake of digital jobs and the digitalisation of our economy. We have also demonstrated that the Laffer curve is real. Continuous increases in the tax rate do not necessarily lead to a rise in tax collection. When we checked the last time the excise duty on data and airtime was increased by this House, between 2019 and 2020, there was a decline in the collection of the excise duty. When they realise that airtime is expensive, people stop talking for five minutes when they make a call and instead talk for four minutes. So, it will not lead to a collection of excess excise duty. That is one of the things that we have disagreed with the National Treasury. We will be recommending that the House reviews that particular matter. The issue of eggs also arose during public participation on the difference between the table and fertilised eggs. We will be recommending the introduction of an excise duty on table eggs to protect Kenya from the cheap imports we are getting from…"
}