Lobbies want Rotich to clarify on new tax policies

Kenya: Professional lobbies want National Treasury Cabinet Treasury Henry Rotich to come clean on whether the income tax will be raised to finance the over Sh200 billion 2014/2015 budget deficit.

Rotich remained mum on new tax bills proposed in the 2014/2015 Budget statement presented to Parliament last week, fueling speculation that Kenyan’s could be slapped with a hefty tax bill in the coming months.

Now, certified public accountants have raised concern over the planned review of the Income Tax Act by July this year. This is as mentioned by Rotich in his Budget statement, stating that any review should cushion low-income earners.

“Currently we have a situation where a large population makes hundreds of thousands of shillings each month while others barely making ends meet, yet these two pay the same tax,” said George Mwangi, a business advisor at GMK Certified Public Accountants.

Growth rates

The Government aims to hit a 23 per cent growth in revenue collection, a figure six points above the 17 per cent average growth rates registered in the past. Rotich additionally said Treasury proposed to introduce the Tax Procedures Bill that will contain uniform procedures across three tax legislations – Value Added Tax, Excise Duty and Income Tax.

“The Bill is aimed at making tax administration easier, while at the same time, reducing the cost of compliance,” he said. Speaking at a Nairobi hotel, Mwangi said the Government should have looked into zero-rating basic food stuffs so as to make them affordable to the common Mwananchi.