Death and taxes – you know the saying. So part of me thinks it’s a good thing that a whole bunch of VAT exemptions have been removed.
Kenya’s tax regime could certainly do with some streamlining, and raising taxes is truly fundamental for a country to pay its own way – it’s easy for Uganda to complain about donors wanting a say in how it runs the country, but if donors cough up roughly a third of the budget, then yes, they might want to have some say in how it’s spent.
But it’s now also clear to me why the VAT bill had to wait until after the elections. Milk price increases may seem inconsequential to me and a bunch of you, but for a large number of people, this is actually a significant share of their daily spending – mostly because food in general takes up a large chunk of their daily budget.
If you routinely order racist croissants and cappuccinos at ArtCaffe (when writing about African middle class, one must make mention of cappuccinos consumed in malls), this isn’t so important.
But when half of what you spend all your money on every day goes up by 16 per cent, then yes, you really feel it. And it appears, from what I’ve seen in the media so far, that there has been plenty of opportunistic rounding up in the new prices, plus price increases in goods that hadn’t actually been affected by this change in the VAT regime.
Nikhil Hira from Deloitte also pointed out that there will be a significant impact on small farmers – who, if you want to rock out more stereotypes, are surely at that backbone-of-the-economy intersection of small entrepreneurs and agriculture: Since VAT has been imposed on many of the inputs like fertilizer and feeds, but small producers can’t reclaim it. So the social impact on the lower-income demographic is quite significant.
Most people will probably feel a little more sympathetic about paying taxes if they can see their money go to a sensible purpose.
Of course, spending on some of the areas that make an immediate impact of that low-income demographic has been limited and acrimonious: remember the teacher strikes and also the disputes over the salaries of healthcare staff. On the other hand, MPs have astonishingly managed to bully and blackmail their way back to a Sh1.1m salary.
Now that’s been achieved (in defiance of the spirit of the new constitution), can you expect them to go back to work? Nope. Instead, a large number of that lot are preparing to travel to Den Hague to hold Mr Ruto’s hand (and presumably there’ll be shifts so that Mr Kenyatta won’t have to travel on his own either).
This will be incredibly costly, and the source of the money is hazy (in all likelihood, you, dear tax payer, will be asked to pay for it). Also, whilst away to play in the Netherlands, your MPs still draw a (whopping) salary and won’t do any work. Faffing around in Den Hague isn’t work.
If you want to convey your best wishes to Mr Ruto, lovely âpick up the phone. Draw him a card. Get on Skype. Send an email. ICC isn’t Uhuru Park where you can whip up the masses with ‘prayer rallies’ (yes, those are quotations marks of derision). There is nothing to do for you in Den Hague, and plenty to do for you here.
During the television debates of the presidential candidates, Mr Kenyatta said that the ICC cases were ‘a personal challenge’ – and ultimately it was up to the voters to decide whether they would feel comfortable being represented by a candidate whose personal challenge would likely take up a good bit of time he would otherwise be able to devote to the work the citizens pay him for.
It was also up to both Mr Ruto and Mr Kenyatta to decide whether they could truly commit to the most senior positions in the country, knowing that they would have to devote a significant amount of time to their court cases. Unless they were dishonest, I trust that they have made arrangements.
Kenya’s government is not just the president and deputy president, and that Kenya has institutions that, in some shape or form, do look after the running of the country (and, of course, also MPs – technically they have a role to play.
Yes, I know, don’t laugh). On this basis, I expect Mr Kenyatta and Mr Ruto to stay true to their ‘personal challenges’ promise and order the MPs to sit down and get ready for some work so that such challenges don’t immobilize the country’s legislative process, nor drain it of scarce financial resources.