CORD to push for VAT waiver on foodstuff

September 16, 2013 3:48 pm


Budalangi MP Ababu Namwamba read the group's resolutions. Photo/FILE
Budalangi MP Ababu Namwamba read the group’s resolutions. Photo/FILE

NAIROBI, Kenya, Sept 16 – Reprieve may be on the way for Kenyans over the contentious 16 percent Value Added Tax (VAT) imposed on basic goods, if efforts being made by various parties to amend the law succeed.

Among the initiatives is a bid by the Coalition for Reforms and Democracy (CORD) lawmakers to introduce amendments to the VAT Act to exempt basic commodities.

“CORD will sponsor immediate amendments to the VAT Act to cushion ordinary Kenyans from their present suffering,” Budalangi Member of Parliament Ababu Namwamba announced on behalf of the legislators.

The Consumers Federation of Kenya (COFEK) also seemed to have reached some sort of middle ground with the National Treasury on the Act against which it had called for demonstrations.

“We have called off the demonstrations as we have held discussions with the National Treasury and agreed on some very pertinent issues,” COFEK Secretary General Stephen Mutoro told Capital FM News.

Mutoro said the National Treasury Cabinet Secretary, Henry Rotich, would reveal what they agreed upon by close of business on Monday.

He further stated that the federation had already engaged two members of the National Assembly in order to see amendments made to the VAT Act 2013.

“I’m looking at the Amendments right now and they will be presented to the Speaker of the House as soon as Parliament reconvenes tomorrow,” Mutoro said.

The taxes introduced on basic commodities such as milk in the beginning of September have caused uproar among Kenyans and even caused President Uhuru Kenyatta and his Deputy William Ruto to weigh-in.

They reprimanded traders who took advantage of the Act to raise the prices of other basic commodities such as wheat and maize flour which remain exempt from the tax.

Despite the Kenya Revenue Authority’s efforts to raise awareness on what commodities have been affected by the tax, both CORD and COFEK have kept their foot on the gas pedal in calling for amendments to the Act.

“We challenge the National Assembly to prioritise the cost of living crisis as opposed to the Kenya’s ICC cases at The Hague. MP’s must be reminded of the reality of their likely recall after all the sovereign power belongs to the people of Kenya. That power includes tax boycott as and when deemed necessary,” the Federation had threatened.

CORD leader Raila Odinga had instead recommended that the government lower the tax from 16 to 14 percent and grow the tax base while exempting basic commodities.

COFEK cautioned that the 16 percent tax on basic commodities would have the retrogressive effect of forcing Kenyans to procure sub-standard products and lead to double digit inflation.

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