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{
    "id": 218021,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/218021/?format=api",
    "text_counter": 71,
    "type": "speech",
    "speaker_name": "Mr. Kimunya",
    "speaker_title": "The Minister for Finance",
    "speaker": {
        "id": 174,
        "legal_name": "Amos Muhinga Kimunya",
        "slug": "amos-kimunya"
    },
    "content": " Mr. Speaker, Sir, laying the foundation for achieving our Vision 2030 will require adopting new technologies and deployment of cost-saving measures in order to be globally competitive. It is, therefore, imperative that the leasing sector be encouraged in order to provide avenues for businesses to acquire financing of new technologies. I propose, in this regard, to amend the Eighth Schedule to the Value Added Tax (VAT) Act to zero- rate leasing of some equipment. Mr. Speaker, Sir, the withholding VAT system has brought administrative challenges, both for taxpayers and the Kenya Revenue Authority (KRA). I will be reviewing this system soon in order to bring our VAT system in line with the best practice. In the meantime, I propose to give the Commissioner the powers to exempt some of the taxable supplies, including lease financing from withholding system requirements as well as to deregister any person from being a withholding VAT agent. Mr. Speaker, Sir, during last year's Budget, I proposed amendments to the Insurance Act to provide for cash and carry in respect of fire and motor vehicle insurance cover. In view of the success of this initiative, and the positive impact of this measure on the industry and in order to further streamline the industry and bring down the cost of insurance, I propose to extend cash and carry to all classes of business. Mr. Speaker, Sir, while on the VAT subject, I wish to acknowledge complaints I continue to receive from the business community regarding the persistent delays in the refund of VAT and its impact on their business operations. This is despite the fact that last year, I enhanced funds for VAT refunds to Kshs900 million per month. Being a Government that listens to its citizens, the Government will look into ways of fast-tracking VAT refunds, including the possibility of automatic refunding of the claims without audit before payment can be made, especially those who have a proven track record. Mr. Speaker, Sir, last year, in consultation with my counterparts from Uganda and Tanzania, we agreed to reduce the import duty on several goods to encourage growth of our industries. To further consolidate the growth of our manufacturing sector and expand opportunities for Kenyans to find jobs, we have agreed on a couple of things. (i) Reduce import duty rate from 25 per cent to 10 per cent on felt materials that are used for the manufacture of oil and air filters for the motor vehicles. (ii) Remove the import duty rates on textile fabrics and felt that are needed in the manufacturing process of paper. Further, import duties on millstones and grindstones for milling, grinding or pulping have been removed. Mr. Speaker, Sir, our importers have continued to incur higher import costs arising from the Import Declaration Fee (IDF). In order to reduce the cost of importation and make such imported goods affordable to Kenyans, I propose to reduce the IDF fee from 2.75 per cent to 2.25 per cent for all goods imported from outside the East African Community (EAC) countries and no fee will be charged on goods imported from within the East Africa partner states."
}