Traders decry the adverse effects of new tax proposals

The price of basic commodities is expected to rise once the Financed Bill 2024 is passed. [File, Standard]

A cross-section of citizens have voiced their concerns over what they term adverse effects of proposals contained in the Finance Bill 2024 on household budgets.

The Bill proposes to impose an excise duty of 25 per cent on raw and refined edible oil while at the same time introducing a 10 per cent excise duty on plastic packaging material under the Eco Levy.

The National Treasury further proposes to introduce a 16 per cent VAT on bread as well as charges on diapers.

Several women and tax experts said households have been hit by general inflationary pressure that has resulted in reduction of their purchasing power and any new taxes would further impoverish the poor.

A tax consultant and a practising auditor, CPA Joseph Ngunju, said imposition of additional taxes on essential consumer goods such as edible oil and bread would affect consumption habits of many families.

Ngunju said owners of many micro-enterprises and workers doing menial jobs were struggling to feed their families, adding that more taxes would put some goods beyond the reach.

“I have over the past three years witnessed the collapse of many small businesses including retail and wholesale shops, private nursery and primary schools, petrol service stations, hotels, boutiques and posho mills due to depressed economic situation in the country,” he said.

He said the collapse of businesses leads to massive unemployment, further worsened by the rising inflation.

A Nakuru woman leader, Assumpta Muiruri, said households were already reeling with the high cost of living. “As a leader, I have interacted with many women who have been unable to afford cooking oil and have resorted to boiling food.” Mururi said.

She said the imposition of a 10 per cent excise duty will consequently lead to a rise in the cost of plastic containers used in the packaging of edible oil. “This government ascended into power by promising to address the plight of the poor but the measures being implemented will hit them hard. The government is now introducing 100 per cent poverty from the grassroots, instead of implementing the bottom-up economic transformation agenda which they promised voters,” Muiruri said.

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