Kenyans to pay more taxes

December 7, 2008 12:00 am

, NYERI, Kenya Dec 7- President Mwai Kibaki has announced that ordinary Kenyans are likely to pay more taxes even as their political leaders defied public pressure to have their allowances taxed.

Without disclosing what areas are to suffer the increase, the  Head of State said the government has been forced to work on hiked levies to boost its ability to finance new projects.

“So if you hear we have raised certain taxes, don’t complain. If you want the government to finance development, then you must realise that those funds will come from you,” he told a public rally at Kamukunji stadium in Nyeri town.

President Kibaki who was speaking after a two-day tour of development projects in the larger Nyeri District said pertinent national issues such as the serious understaffing in public schools could only be addressed fully as soon as the Government had adequate funds to hire enough teachers.

“The Government is aware of the understaffing in schools but handicapped by lack of sufficient resources to employ the teachers from the training colleges,” the President said.

The Head of State thanked majority of Kenyans who paid taxes on time saying the few defaulters will be netted and prosecuted in accordance with the law.

“There are a few people who don’t pay their levies. But we know them and will apprehend them. But don’t pity them. This country doesn’t need such people,” he said.

The President spoke as public outcry continues over a refusal by Members of Parliament (MPs) to have their allowances taxed.

Legislators argue that they donate a lot of their money to their constituents and that the law prohibits constitutional office holders from paying tax on their hefty allowances.

 But the Kenya Revenue Authority (KRA) has confirmed the law makers can pay taxes directly to it.

KRA has explained that Section 3(2) (a) of the Income Tax Act provided for the taxation of all gains and profits derived from a person’s employment irrespective of his office.

“While the initial responsibility to deduct and remit taxes rested with an employer, the ultimate burden of ensuring that the requisite tax was paid rested with employees,” the taxman said in a statement on Friday.

The Law Society of Kenya last week petitioned the President to reject the Finance Bill in its current form which excludes a clause that seeks to tax the allowances enjoyed by MPs.

Chairman Okong’o Omogeni said the society had submitted a letter to President Kibaki requesting him to exercise his powers and send the Bill back to the House for amendment.


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