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{
    "id": 808273,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/808273/?format=api",
    "text_counter": 202,
    "type": "speech",
    "speaker_name": "Kipkelion East, JP",
    "speaker_title": "Hon. Joseph Limo",
    "speaker": {
        "id": 1915,
        "legal_name": "Joseph Kirui Limo",
        "slug": "joseph-kirui-limo"
    },
    "content": "afford housing, it will take a lot of time for them to do valuation. Therefore, it will pile up and slow down the process. According to the ISK, they were of the opinion that they have over 600 valuers in private practice who should be brought in to help the Government to achieve the cheap and affordable housing projects in a fast and efficient way. That was their view. Our Committee, of course, at a later stage, discussed and we will be moving some amendments to that effect. We also had the Kenya Association of Manufacturers (KAM), Agrochemical Association of Kenya (AAK) and the Federation of Kenya Pharmaceutical Manufacturers (FKPM). They came particularly to prosecute the issue of zero-rating as opposed to what is being proposed here to exempt the products around medicine, pesticides and various types of foods. Hon. Mbadi had tried to explain the import of this, that if we allow exemption, any manufacturer in this country will be required to treat their products in a way that they are not able to claim any input tax into production. This means that if you are producing medicine like Panadol in Kenya, and you are sourcing materials within the country, and these materials are treated as tax exempt, that means they will not be taxable. When you are selling medicine, you will have incurred input tax during manufacturing that comes from electricity and other costs, but you will not claim it. Given that you will not be able to claim that particular cost, it will obviously and practically be passed on to the final consumer. It means that if you have Panadol, which is imported, and you have Panadol, which is manufactured in Kenya, the production cost in Kenya will be higher than the imported ones. Apart from the fact that the consumer will bear higher cost, there will be a temptation for importation of cheaper products. Therefore, it will work around negatively on the pillar of manufacturing because manufacturers in Kenya will not be able to compete favourably with manufacturers who will sell in Kenya through importation. These particular associations expressed themselves very well. At a later stage, we will move an amendment. We also heard from several others from the oil industry. The oil industry currently is in a very young stage. Therefore, the issues of taxation currently are not targeting real business bruise if we try to tax them, it will be like taxing capital. Therefore, they were of the opinion that a consideration should be made to extend the timing. They were given some holiday up to end of this financial year before they can start paying real tax. They were of the opinion that they should be given more time. We also had PricewaterhouseCoopers (PwC) together with the KPMG, who appeared before us. The KPMG observed that this particular Bill proposes to double the tax-deductible savings for housing from the current Kshs48,000 to Kshs96,00. Currently, if you have a savings plan for housing, you are only allowed to save up to Kshs48,000 per year. Now, the Bill proposes to increase these savings to Kshs96,000. In the opinion of the KPMG, when you ask someone who is already saving Kshs48,000 to double, you are asking someone who is earning little to double the savings. The thinking of the Government is to make the low-income earners to afford housing. This is only possible if you assume that they have disposable income which is able to cover the additional room for saving."
}