Entry Instance

HTTP 200 OK
Allow: GET, PUT, PATCH, DELETE, HEAD, OPTIONS
Content-Type: application/json
Vary: Accept

{
    "id": 988231,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/988231/?format=api",
    "text_counter": 221,
    "type": "speech",
    "speaker_name": "Suba South, ODM",
    "speaker_title": "Hon. John Mbadi",
    "speaker": {
        "id": 110,
        "legal_name": "John Mbadi Ng'ong'o",
        "slug": "john-mbadi"
    },
    "content": " Thank you, Hon. Deputy Speaker. As I support the discussion on this Bill and the approval of the same, I just wish and hope that Members will restrict themselves to discussing the Tax Laws (Amendment) Bill. It is because there will be a Supplementary Budget and a Motion on other issues. The main reason for the proposal to amend various tax laws, the Income Tax Act, the Value Added Tax Act, the Excise Duty Act, the Tax Procedures Act and the Miscellaneous Fees and Levies Act is to help alleviate the negative impact of the pandemic by enhancing the disposable income, especially for workers; and also to protect businesses. So, the main reasons for this are two. One is to put money into the pockets of Kenyans and two is to protect businesses and jobs. First of all, the amendments to the Income Tax Act are as follows: Number one is the Turnover Tax, which is being reduced from 3 to 1 per cent. Again, there is even a change on the threshold of the Turnover Tax. Currently, the Turnover Tax is considered as from zero to Kshs5 million turnover per year. The amendment seeks to change it to from Kshs500,000 to upwards of Kshs15 million. So, that is targeting enterprises. It is putting more money in the pockets of enterprises at this difficult time. Number two is on PAYE, about which I am sure everyone is aware. We are seeking to have those who earn below Kshs24,000 to be exempted from paying tax or to have them pay zero tax. At the same time, it is increasing personal relief by Kshs992, from Kshs1,408 to Kshs2,400. There is also the change on tax bands. Whereas we presently have the minimum at 10 per cent, it is going to move to 15 per cent. The maximum is going to be reduced from 30 per cent to 25 per cent. This largely is going to help those who are in formal employment. It is going to put money into the pockets of Kenyans but, only those who are in formal employment. That is the caveat. We are aware that very few Kenyans are in formal employment. Therefore, those who are going to benefit are not so many. However, it is going to improve their purchasing power. There are amendments on allowable deductions for tax purposes, which I may lack time to discuss. Investment deductions also under Income Tax are here. Additional taxation of non- residents is also captured here to provide money to plug the hole which is going to be left. My concern was with the proposed amendments from the Ministry responsible for the National Treasury regarding Value Added Tax. I am happy the Committee has picked this. The proposal to remove items like supply of ordinary bread from zero rating was going to affect the ordinary Kenyan. It includes the inputs for the manufacture of agricultural pest control products and materials for the manufacture of solar batteries. We know we want to go green as an economy. Removing agricultural pest control products, fertilisers and many other things like medical equipment from zero rating is something we could not allow. I am happy the Committee has picked this. This is also a warning to the Government and the National Treasury not to give to Kenyans with one hand and take from them with the other, especially poor Kenyans. This is a time to cushion the bottom segment of our society. The amendment proposed under Excise Duty is basically removing the separation between imported sugar and locally manufactured sugar. I agree with this because it was very difficult to determine which one is locally produced manufactured sugar and which one is imported. It had the effect of flooding the market, causing a lot of confusion, distortion and unnecessary trade practice. The amendment to the Tax Procedures Act is to appoint banks to act as revenue agents for the Government. I think the Government has in mind the issue of the Nairobi City County. They 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."
}