Raila backs MPs taxation bid

December 5, 2008 12:00 am

, NAIROBI, Kenya – Prime Minister Raila Odinga has disclosed that the Cabinet plans to introduce a clause in the Miscellaneous Amendment Bill that will seek to persuade Members of Parliament to pay taxes on their allowances.

Mr Odinga told representatives from the private sector on Tuesday that the clause would aim to lobby the MPs to remit taxes to the Kenya Revenue Authority since the Executive arm of the government could not force them to do so.

“Are we going to lobby? Yes. We are going to try and see if something can be introduced in the Bill that will enable us to move towards that direction,” he said.

He however clarified that the government would not arm-twist or blackmail the legislators into paying taxes but would employ ‘lobbying and persuasion.’

“We live in a democratic society. Parliament is an institution that is separate from the Executive so it can counter the directives of the Executive,” he explained.

Mr Odinga further disclosed that the decision to get the MPs to pay taxes on their allowances was approved at the Cabinet level and it was the government’s position that everybody should remit taxes.

“The government’s position is very clear and that is why that issue (of MPs taxation) was in the Budget. This was discussed in the Cabinet before the Budget speech and it is not an invention of the Treasury,” he said.

The proposal to tax the MPs was made by the then Finance Minister Amos Kimunya during the reading of the 2008/2009 financial budget in June.

This was the first time that the Premier was speaking about the issue that has caused public outcry. Many Kenyans want MPs to pay taxes on their allowances and they have appealed to the President and the Prime Minister to intervene.

MPs have however conspired against remitting taxes and arm-twisted the Acting Finance Minister Mr John Michuki into withdrawing a clause in the Finance Bill that would have seen them pay the taxes.

The lawmakers earn a basic salary of Sh200,000 on which they pay Sh53,000 as tax but other allowances amounting to over Sh650,000 are untaxed.

A number of lawmakers led by Kangundo MP Johnstone Muthama have bowed to pressure and offered to remit the taxes despite the lack of a proper law to govern the payment of such taxes by MPs.

An economist Dr Kibua Nzioka has warned that the refusal by the MPs to pay taxes on their allowances could result in civil strife.

In an earlier interview with Capital News, Dr Nzioka termed Kenyan MPs as “economic saboteurs who are insensitive to people’s needs and are holding the country hostage a situation that is likely to lead to political instability.”


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