You are being misled by DAVID NDII and other advisors – ICHUNG’WAH now differs with RUTO on more taxes

Friday, May 17, 2024 – President William Ruto’s appetite for more money by overburdening Kenyans through increased taxes has not gone down well with some of his key allies.

National Assembly Majority Leader Kimani Ichung’wah is one of the allies who feel Ruto is being misled by his advisors on taxation.

Speaking during an interview, Ichung’wah proposed a reduction in Value Added Tax (VAT) as part of Kenya's tax policy adjustments.

This comes amidst the debate over Ruto’s bid to increase the tax-to-GDP ratio.

Ichung’wah, who has a background in accounting, recommended slashing the current VAT rate from 16 percent to 15 percent.

He argued that such a move, coupled with the elimination of tax exemptions on VAT and zero-rated items, could enhance revenue collection for the government.

Ichung’wah argued that reducing the VAT rate could potentially lead to increased tax revenues without overburdening Kenyans.

“If you were to ask me if we were to reduce even the standard VAT rate from 16 per cent to about 15 per cent, then do away with all the tax exemptions on VAT and zero-rated items. We would collect more money,” Ichung’wah stated.

The proposed adjustments come in the wake of the Finance Bill 2024, which aims to introduce VAT, and raise excise taxes on various items, including M-Pesa transactions, airtime, and bank transfers.

Additionally, the cost of mobile money transfers, airtime, and data is set to rise with proposed additional taxes on these services.

The Finance Bill also aims to revoke VAT exemptions on various financial services and betting, gaming, and lottery services, subjecting them to the standard VAT rate.

Ichung’wah criticised the current tax system, highlighting its disproportionate impact on the middle class.


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