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"id": 216566,
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"type": "speech",
"speaker_name": "Mr. Syongo",
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"id": 316,
"legal_name": "Zaddock Madiri Syong'oh",
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"content": "Mr. Temporary Deputy Chairman, Sir, once again, I want to reiterate my earlier statement that the measures that the Minister has taken are largely well thought through; and to a larger extent, he thought big as he should, given the current stage of our economic development. However, he then suddenly, as Prof. Anyang-Nyong'o said, started fiddling with small ideas instead of consistently thinking big, like I know he is capable of. Let us take, once, again, the issue of the relief on the Sugar Development Levy (SDL) on imported industrial sugar. The Minister is encouraging importation of industrial sugar by lowering its cost. Secondly, he is favouring the products of the South African-owned Coca Cola Bottlers. The Minister has been at pains, and he is my friend, to suggest that he was protecting the local industries so that they do not migrate. I know he is a brilliant accountant. However, I have worked in the private sector, and particularly in the manufacturing sector. I can assure you that no industry will relocate because of a 7 per cent SDL tax on imported industrial sugar---It is such a minute cost of production! Only an insane industrialist will migrate to a neighbouring country because of that tax. Even more worrying is that he is reducing and distorting the relative competitiveness between soft drinks and fresh juices which do not have sugar additives. By doing so, he will make the soft drinks cheaper, relative to the price of fresh juices which have no sugar additives. That is a discouragement to our agro-processing and value addition which I know, when I was in the Ministry of Trade and Industry, was a key pillar of our industrialisation strategy for this country. I would have expected that, instead, he would have had an incentive regime for agro-processing, especially fresh produce and fresh juice processing. Mr. Temporary Deputy Chairman, Sir, under Excise Duty measures, the Minister has proposed specific Excise Tax of Kshs6 per litre of drinking water. If you look at our neighbouring countries, especially to the north, this country has enormous potential to process water and export it. Since we can now bottle water, it is now an exportable commodity, which was never thought of 30 years ago. We are making an essential commodity, a source of life, more expensive for a consuming citizenry who presently, because of inefficiencies of municipalities and local authorities, have no access to clean and safe water to drink. Many times, you see our little children coming from school thirsty. Sometimes you pity them because you can see them drawing water from pools on the road side, rivers or taps which, definitely, contain unclean water. The idea should have been to help expand the local industry for cleaning up and bottling water for the domestic and export markets. I want to request the Minister to re-think that matter as we come to the Finance Bill. Let me turn to the question of discouraging importation of second-hand spare parts to enhance safety of Kenyans on our roads by imposing a 20 per cent Excise Duty on all imported used motor vehicle spare parts. Do we have an alternative? Do Kenyans have an alternative in terms of locally produced spare parts? If there are, and I would like to believe that only specific spare parts are locally produced, I will be more than happy to support this measure, but specific to those that we are producing locally. But those that we still do not produce locally, they should not attract the 20 per cent Excise Duty. This is too much of an umbrella measure. I would like to appeal June 28, 2007 PARLIAMENTARY DEBATES 2147 to the Minister to re-look at the figures again and reconstitute the composition of that tax regime. Mr. Temporary Chairman, Sir, with regard to the issue of VAT, the Minister proposes, in order to encourage the dairy farmers, to zero-rate the tax on powdered milk. I agree with him, but I think he should also address issues regarding the supply side. As my colleagues have said, he needs to be specific in terms of locally produced powdered milk. He also needed to go a little bit further and give incentives to milk processors who want to produce powdered milk by zero-rating the machinery and packaging equipment. I want him to think about that so that we deal with both the demand and the supply of the product. Let me turn to the issue of cigarettes. I think my colleagues have talked well-enough about that. However, regarding the issue of filtered cigarettes, I have made remarks on it on two occasions. Although this may not fall directly in terms of the current tax measures, I would like to suggest that there should be a tax incentive regime involving import duty, VAT and even corporate tax. We should promote the generation of renewable energy and encourage the use of solar, wind and mini-hydros to match the substantial and wonderful investment that the Government is putting on power distribution. It is a great measure. However, there is no power generation that can match that investment. A tax relief on power generation would have been ideal. Those who want to invest in renewable power generation facilities should have been given a tax holiday, duty-free and VAT free incentives, including those who wish to invest in setting up plantations for bio-fuels like sweet sorghum and geotroper. That should really have been captured in the tax measures. Mr. Temporary Chairman, Sir, with those few remarks, I beg to support."
}