Saturday, September 7, 2013

Taxing the Poor while the Rich on the Loose!

Taxing the Poor while the Rich on the Loose

Did you know that the fiscal policy framework is designed to make you poorer? Did you also know that you not be seeing any improved service delivery even after you are taxed more on commodities you need for your survival? Did you know that since the time Kenya was invaded by the rich, the Members of Parliament and tax evaders, the poor will never see peace?

Kenyans this week were rudely shocked at the effects of the new VAT Act. Basic commodities like bread and milk are now subject to a higher rate thus making it more difficult for the normal person in Kenya who does not have a high income to suffer the consequences of higher taxation.

As the days go by and as the dry season creeps in, the cost of energy will continue to sky rocket and this will push further up the process of commodities due to the factor of high energy dependency in the production sector. This is a call to all ordinary Kenyans to tighten their belts further as what happened this week was just a tip of the iceberg.

 This will further push inflation to higher numbers and make life even more difficult. It is not good news at all in as much as government will be smiling all the way to KRA to collect the revenues that are as a result of the suffering of most Kenyans.

The Lies in the VAT Act.

It is not a fact that the taxation of basic commodities will make it simple for government to collect more revenue. With majority of Kenyans living beloe the poverty line, it will make it very difficult for consumption of such commodities especially if they are out of the reach of the ordinary citizens. What should be put in place is simply a more broader look at the tax regime and find was of enhancing the already existing laws since it is highly believed that wealthier individuals in the Kenyan society are the biggest tax avaders using their big money.

There are millions of Kenyans who are not currently covered in the tax collection regime. Many of this individuals are the so called the drivers of the economy. Most of the urban centres are seeing more construction of real estate mushrooming everywhere. The rates that come with the developments are not to the reach of the ordinary citizens. However, KRA has not been successful in ensuring that there is a clear mechanism of collecting taxes from real estate owners in Kenya. This is an area that could boost further revenue collected on annual basis more than basic commodity taxes.

The transport sector is also the biggest tax evasion system that exists today. Would it be true to assume that most of the owners of the big transport companies are the real stakeholders in government thus influencing the taxation of the poor? This would be a dangerous phenomenon as it would only strengthen the resolve by the poor to invade the rich if the current trend continues.

KRA is one of the most corrupt institutions in the country as it is believed to be protecting rich individuals who are well known to evade taxes or who are using the weak system to find legal means of not paying taxes. We need more of better and transparent management system at KRA in order to fully utilise the opportunities for tax collection. I believe we can more than quadruple the current amounts collected from our current targeted tax regime whose intend is to punish the poor.

 

While it is true that Government needs to collect more revenue in order to service its current expenditure, it is immoral for more than 70% of the collected revenue to go towards recurrent expenditure instead of development. It is high time Kenyans began to demand for the worth of their money given the fact that the government is not smiling by making them even more poorer. It is only in Kenya where the poor work for the government. To be poor in Kenya is a crime and that is why the taxation regime is only targeting those who cannot afford to service the already overburdened pockets.

 

Should we be calling for another Occupy Parliament on the issue of overburdening Kenyans with unjustified taxes and unfairness on delivery of the same regime?

 

Emmanuel Dennis