National Treasury’s plans to introduce taxation on essential commodities that were once exempted from tax will only serve to hurt low income earners. While Kenya is desperate to cut its budget deficit in the wake of piling pressure to put brakes on borrowing, additional taxes on commodities such as bread will be on the extreme.
Instead, government should heed proposals by international bodies such as the International Monetary Fund calling for a widened tax base.
It is good news that government has hired Adam and Smith International consultant to look at the tax potential of counties.
This should help net more revenue by sealing the gaps being exploited by tax cheats. Introducing taxes on basic commodities means that the poor will be faced with a tough balancing act, since for them, food takes the lion’s share of their budgets. Most are left with nothing to save.
The lower class citizens need breathing space. Costs of essential items are already on the rise owing to many factors, including the hidden cost of corruption that has made production costs go high. Hitting such a group with new taxes will make their lives miserable.
It will be prudent for government to make the best use of the current taxes being collected. Only after satisfying the public that their hard earned money is being applied correctly can government come asking for more. But doing so at a time the country is replete with stories of theft and wastage in public offices is a slap in the face of the taxpayers.