Baringo Senator Gideon Moi has waded into the discourse about the implementation of 16 percent Value Added Tax on Petroleum products, terming the move as one with dire effects.
In a statement sent to newsrooms, the legislator has highlighted certain ways in which the directive contained in Finance Bill 2018 will hit the taxpayer hard.
“Though the government need the money to fund development projects, the ripple effect of the implementation of the tax has far and wide ramifications which include high cost of living, rising inflation, loss of jobs and slow growth in the economy,” reads the press statement from Moi.
Senator Moi notes that ordinary Kenyans are already grappling with tough economic conditions and that new taxes levied on fuel definitely aggravate their sufferings. He further indicates that it sounds ironical that low income earners who should be cushioned from harsh economic tides are now ‘condemned to misery by Government policies.’
He however acknowledges that the government needs money to fund the budget, which he says can be acquired through other avenues.
His statement reads: “It is thus prudent for the government and all other relevant agencies to come together and explore other ways of raising revenue other than implementing the rise in tax on petroleum products which has the overall net effect of condemning majority of Kenyans into poverty as they are forced to dig deeper in their pockets.”
His sentiments are shared by Minority Leader in the National Assembly John Mbadi who lamented the decision to effect 16 percent VAT on petrol as of September 1.
Mbadi also urged the government to source for other ways to raise Sh70B deficit contained in Finance Bill.He argued that the amount is a drop in the ocean in the Sh3T budget.
The government came with the directive after the International Monetary Fund recommended it to help in raising revenue for recurrent expenditure and development.
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The tax increase on fuel has caused a stir with legislators fuming at Treasury Cabinet Secretary Henry Rotich for defying parliament on the matter. Suba MP John Mbadi blamed Rotich for undermining parliament, effecting the directive after parliament voted to postpone it for two years.