CS Ndung’u: There’re serious consequences for dropping taxes proposals in Finance Bill

Business & Tech
CS Ndung’u: There’re serious consequences for dropping taxes proposals in Finance Bill

The National Treasury now says that there will be a revenue shortfall of KSh200 billion if the revenue raising measures contained in the Finance Bill 2024 are not approved by the National Assembly.

As a result, Treasury Cabinet Secretary Njuguna Ndung’u says there has to be more stringent austerity measures in Government after several tax proposals in the controversial bill were dropped.

Some of the measures Treasury is proposing to address the revenue shortfall include; general expenditure cuts across the Judiciary, Executive and Parliament, reversing the proposed additions in the Appropriations Bill for financial year 2024/25 across all the Ministries, Departments and Agencies (MDAs).

All additional new budget lines in the Appropriations Bill will also have to be reversed.

Speaking during the launch of the Public Procurement Regulatory Authority (PPRA) 2023-2027 strategic plan on Wednesday, June 19, CS Njuguna insisted the new taxes were meant to raise revenue to manage the economy and help government achieve development goals.

CS Ndung’u: We can’t borrow anymore

“We want the government to increase spending because we need schools, health facilities, roads and other infrastructure. We need to reduce the cost of doing business because that will increase profitability in the private sector. All these are positive. But when we say we are going to increase spending, the only way we can do that is through taxation or through borrowing,” he said.

The CS also ruled out the possibility of borrowing, noting that Kenya has already reached its debt carrying capacity limit.

“We have a limit in terms of debt carrying capacity, we are already suffering from the burden. This is something I have talked about many times. Everybody resists high taxes, especially taxes on the final consumption goods. So you have to be very careful with what you are asking for, if you are asking for spending, you have to ask yourself how long can I spend because you have capacity constraints,” he added.

MPs debate

Members of Parliament (MPs) are today (Thursday, June 20) set to resume debating the Bill which has sparked protests by a section of Kenyans over its push for more taxes.

The National Assembly Finance and National Planning Committee, led by Molo MP Kuria Kimani, tabled its report to Parliament on Tuesday, June 18 following the bill’s public participation.

On Wednesday, June 19, MPs debated on the proposed law, with clear indication that Kenya Kwanza legislators have been whipped to support the bill.

National Assembly Speaker Moses Wetangula directed any MP planning to move an amendment to the Bill to do so by today 1 pm.

Related Posts

See all >>

Latest Posts

See all >>