Tax experts fault Uhuru Budget

June 12, 2009
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, NAIROBI, Kenya, Jun 12 – Experts say Finance Minister Uhuru Kenyatta should have focused more on enhancing security around the country in the Budget delivered on Thursday.

While lauding it as a ‘people friendly budget’, PKF Partner Joseph Gichuki said on Friday that Mr Kenyatta should have allocated more funds towards the recruitment of more policemen and development of security infrastructure.

He also said the Finance Minister ought to have allocated more funds to the tourism sector.

“There are not enough policemen. Our police force is far too small. It should be double or triple the size that it is,” he alluded.

“The amount also set aside for (tourism) marketing is even less. I think it is clear that the government is expecting that the players in the market who are already weakened (will) do their own marketing,” he added.

Mr Gichuki was further of the opinion that the Budget reflected the long term reform agenda by the government to improve the livelihoods of Kenyans.

“The budget is really not just a pause but it gives time for reflection ad consideration whether or not we as a country are on the right track,” he said.

“By and large there were no great surprises and I thought that is how it ought to be.”

Deloitte Tax Partner Nikhil Hira, meanwhile said that the Finance Minister should have improved on his revenue collection by lowering corporate tax.

“He should really have reduced the corporate tax rate from 30 percent and bring it down by two or three percent,” he suggested.

“It would have had a marked impact on revenue collections.”

Mr Hira said that the Finance Minister should also have placed more effort in the area of inflation, and focus more on reducing the prices of basic commodities.

He stated that when people are tied down economically, the last thing on their minds is buying expensive jewellery and other commodities.

“It would have been nice to see more zero rating of basic food stuffs and it would also be nice for him to provide a big investment allowance for satellite towns outside the city,” Mr Hira said.

During the budget reading, Mr Kenyatta decentralised resource allocation to the constituencies.

In what could be described as an ambitious budget, the Minister also proposed to allocate funds to cater for basic facilities in key sectors of health, education, roads, agriculture and industrialisation to make every part of the country access basic development.

With good political will and prudent financial management the Minister said the budget was a customised financial stimulus aimed at cushioning the common man against the socio economic challenges.

The proposal immediately made him a hero among fellow legislators who came close to a standing ovation as he stated that they now have the privilege of controlling a larger share of the development funds than before.
 

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