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November 21, 2018

KIBISU KABATESI: Taxes tailor made to sabotage Big 4


A stark choice awaits you, President Uhuru the the Kenyatta: Lose Sh70 billion in fuel levy and measly World Bank loan, or the country. The country is in a riotous mood over extreme taxation, which has become a sport for you. Should you collect Sh70 billion to fill the gap in an ambitious Sh3.4 trillion budget by refusing to sign the amended Finance Bill into law and thereby trigger a wave of inflation and protests? Or sign the Bill and save Kenyans from the slavery of overtaxation?

Kindly also reconsider the burdensome cost of electricity. What’s the use of the Last Mile Connectivity Project when the beneficiaries can’t afford the bills? Who does the project profit other than suppliers and tangatanga politics? VAT on petroleum is laden with clandestine excise tax, road maintenance levy, petroleum development levy, petroleum regulatory levy and railway (SGR) development levy. On the other hand, its twin sister electricity has sinister taxes coded as REP, Warma, ERC, fuel, Forex and inflation adjustment. For whom are we toiling?

The loathsome taxes are, interestingly, tailor-made saboteurs of your Big Four agenda. No government has survived taxing the poor. Kenyans are pining for a fight to the death against taxes that repay debts incurred on flamboyant projects with no immediate benefits. You could argue you’re investing in the future, but why trample on the present to reach an uncertain future?

You have a Sh5.1 trillion debt hanging on your neck. Can you sincerely explain what it did for Kenyans other than pilferage by those in your immediate vicinity? So you need another Sh3.4 trillion to fill a huge budget hole? Nothing in it speaks to the Big Four.

Political hustlers seeking your attention shout about realigning everything from new carpets in their opulent offices to cattle dips and paving footpaths to the Big Four. Yet there isn’t anything in Kenyans’ lives to show for the Big Four, only your supplementary anti-corruption zeal.

The collateral damage from the rushed taxation will be catastrophic. The Sh70 billion petroleum levy will cause you political constipation yet not fund the Big Four. The creative accounting top-up on electricity bills also won’t. The disgusted will switch back to candle and wood for lighting. You will have no taxable electricity user. Kenya will be plunged into darkness soon. Caring for children, indeed! What intelligentsia will sprout from reading using toxic sooty wood and candle light?

Higher fuel costs erode purchasing power and push up operating costs. Passing the additional costs on to consumers triggers a wave of inflation. Your Big Four manufacturing pillar will be the immediate casualty; produce and movement of goods will be too expensive. Some will desperately cling to dead stock while others close shop for lack of buyers. When you can’t produce or produce expensively, you cannot find buyers. Whom will you tax when the chamber of commerce is dead? Of course, the poor Mr President.

Consider too the harm to UhuruCare. Steep fuel costs will stymie access to nutritious food and access to health facilities. The food security pillar is already compromised by skyrocketing farm input prices and corruption. Remember you waxed lyrical about making agriculture commercial? Farmers got adulterated fertiliser and are not paid for their produce. Lastly, to whom will you sell ‘affordable’ houses after taxing Kenyans dry, bereft of disposable income?

Neither will the war against graft recover money that could fix the cash crunch. Fellows who have stolen are hard nuts to crack; they would rather be jail than surrender loot enjoyed by their extended families. Others will rather share loot with investigators, prosecutors and judges to secure bearable jail sentences or acquittal. The futuristic agreement with the British Premier to repatriate proceeds of crime is no immediate redemption.

We know you’re under pressure from the World Bank to unrealistically collect tithes from famished citizens in order to access further debt. Don’t buy into this. For once our wicked 12th National Assembly put aside its image of a citadel of petty corruption and belatedly gifted you with an amendment in the Finance Bill. Don’t look the gift horse in the mouth, Mr President. Act for the people, save them from a pitiful existence. Listen to the reasonable outrage of the nation.

The writer is a Communications, Publications and Conflict Management Specialist, University of Nairobi

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