NAIROBI, October 21 – President Mwai Kibaki has lauded tax collection efforts by the Kenya Revenue Authority saying collections have almost doubled in the last five years.
The President said although the government reduced the Value Added Tax from 18 percent in 2003 to 16 percent, the authority had managed to record impressive figures posting Sh434 billion in the 2007/2008 fiscal year.
Speaking during a taxpayers’ luncheon, the Head of State stressed that through sustained economic growth coupled with other positive measures, the country will achieve significant poverty reduction.
“We are now set to transform our Country to a middle-income status in line with the Vision 2030, which I launched in April this year as a long term strategy through which we aim to achieve and sustain a growth rate of 10 percent per year,” the Head of State said.
President Kibaki also said that the Government is working closely with the private sector in structural reforms that will make the business environment competitive and attractive to both local and foreign investors.
“We will soon be launching guidelines for public-private partnerships that provide a framework for the private sector to invest in public projects in the area of infrastructure. Indeed, the current global financial instability should give impetus to the need for us to raise funds under the proposed local infrastructure bond,” the Head of State said.
President Kibaki commended Kenyan tax payers for honouring their tax obligations, saying that commitment not only demonstrated patriotism but also made the country self-reliant in financing its development agenda.
“Following implementation of appropriate economic and structural reforms under the Economic Recovery for Wealth and Employment Creation, we have recorded tremendous improvement in the performance of the economy. From a growth rate of 0.6 per cent in 2002, we were able to achieve a remarkable seven percent GDP growth rate last year,” the President said.
President Kibaki once again encouraged Kenyans to embrace the spirit of hard work and harmonious co-existence as a way of overcoming the challenges posed by poverty and unemployment among the youth.
“I want to encourage all Kenyans to remain united because it is through unity of purpose that we will succeed in making Kenya a better home for all of us. And above all, let us embrace the spirit of hard work to enhance our individual well-being and ensure the prosperity of our nation,” the President said.
He commended Kenyans for heeding the reconciliation call by the Grand Coalition Government for all Kenyans to forge ahead in nation building as a cohesive society, saying restoration of peace and security was yielding dividends.
“Having registered negative growth in the first three months of this year, the economy is now on the path to positive growth. Indeed between April and June, the economy recorded a growth rate of 3.2 per cent and we are very optimistic that by the close of the year we shall record a five percent growth rate,” the President noted with appreciation.
The Head of State enumerated the various development projects undertaken by the Government in the last five years, which he said, relied on tax revenues to finance and were successful due to improved tax collection and proper administration by the Kenya Revenue Authority.
Improved revenue collection, the President said, enabled generation of the required resources to invest in infrastructure development and provision of social services to Kenyans.
“For instance, the free primary education programme which we implemented in 2003 increased pupil enrolment by nearly 1.4 million. These are children who would have missed the opportunity to attend school and the chance to improve their lot in life,” the President noted.
President Kibaki cited the rural electrification programme which has expanded opportunities for small-scale businesses and investment besides lighting up rural areas, provision of clean water to rural households and rehabilitation of roads in various parts of the country as some of the important milestones in provision of Government services.
On the escalating food, fuel and energy costs in the country, President Kibaki directed the treasury and other relevant Ministries to identify implementable measures to safeguard the welfare of all Kenyans.
“The high cost of food, fuel and energy is not only an impediment to sustained growth, but was also exerting a heavy toll on the welfare of many Kenyans,” President Kibaki said.
During the occasion, leading tax payers in the country received awards. Safaricom Limited emerged the best tax payer for 2007 and 2008 followed by Kenya Breweries Limited and Teachers Service Commission respectively.