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{
    "id": 1550591,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1550591/?format=api",
    "text_counter": 522,
    "type": "speech",
    "speaker_name": "Alego Usonga, ODM",
    "speaker_title": "Hon. Samuel Atandi",
    "speaker": null,
    "content": "Other factors projected to help us grow the economy include the strong performance of the construction sector. As we are aware, the construction sector did not do well in the first half because most of our contractors were not on site. Most of them are back on site, so the sector will see robust improvement. The other sector that we project will help us improve our economy this year is tourism. The peace and tranquillity created following the formation of the broad-based Government will give us results in the tourism sector. The other sector that will also help us is the housing sector. The Affordable Housing Programme, one of the biggest BETA programmes in this country, is doing extremely well. Coupled with the lowering of interest rates, we also see that the private sector will increase its investments in the housing sector. We cannot leave behind the services sector, which is also projected to grow heavily and help us improve our economy, especially the reforms that have been instituted in the Information and Communications Technology sector. These reforms will collectively help ensure that our economy is up at the projected rate of 5.3 per cent. Hon. Temporary Speaker, let me take you through the fiscal situation of our country. Over the years, we have been over-projecting our revenues when making budgets. This has given us a lot of problems because, in the end, we normally have to resort to borrowing to fill the gaps when there is revenue underperformance. For example, in the last Financial Year 2023/2024, we projected to raise Ksh2.57 trillion in ordinary revenue. At the end of the year, we had a shortfall of about Ksh170 billion. As a consequence, we were able to borrow about Ksh160 billion to fill that gap. The continuous over-projection of revenue is something that this House must address, but we do not have an option. Going forward, this economy is not going to rely on credit. As you are aware of what is happening in the global market, the multilateral and bilateral environment is not conducive for continuous borrowing, and we do not have sufficient fiscal space to continue to pile more credit. There are many avenues that we propose to help this economy to grow revenues. Let me repeat that going forward, it is not going to be easy for us to raise revenue through more taxes. Introducing more taxes is not going to help us. It is not going to be feasible, and that is an area - I would like to caution that going forward - will not work. There are areas that we should explore as a House. One of the areas we need to explore as a House is that we lose a lot of revenues in tax expenditures. For example, we project that the tax expenditures on VAT alone will constitute about 2 per cent of our GDP, which is about Ksh300 billion. This is money that, if we were able to save, would help us raise additional revenues. The size of our economy and the revenue we collect do not match because an economy as big as ours should collect upwards of 20 per cent of our GDP as our ordinary revenue. However, today, we are only collecting about 15 per cent. If you compare this with South Africa, they are collecting 25 per cent of its GDP as 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."
}