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Lawmakers insincere on the 16 per cent fuel tax fiasco

By Frankline Sunday | September 4th 2018
Muranga Senator Irungu Kangata (left) and Majority Leader Aden Duale during a 2018 budget reading on 14/6/18 [Beverlyne Musili,Standard]

Kenyan lawmakers last week voted to defer the 16 per cent VAT on petroleum products through amendments to the Finance Bill, 2018 arguing the levy would hike inflationary pressure.

However, President Uhuru Kenyatta is yet to assent to the Finance Bill, 2018 meaning the 16 per cent VAT contained in the Finance Act 2016 becomes law by default.

This has elicited sharp reactions from lawmakers who accuse Treasury Cabinet Secretary Henry Rotich of subverting the will of the people.

MPs Antony Oluoch (Mathare), Mark Nyamita (Uriri), Stephen Mule (Matungulu) and Caleb Amisi (Saboti) said they would move a motion to impeach the Treasury CS.

“Parliament has already spoken on this so why is the Treasury CS not listening,” Mr. Oluoch told reporters on Sunday. “You cannot look for money without us (parliament) giving you the instruments to collect. If the CS does not listen we shall come for you.”

House Majority Leader Aden Duale, Minority Leader John Mbadi and Nairobi Senator Johnson Sakaja similarly urged the Head of State to sign the Finance Bill 2018.

In December 2014, the same lawmakers however voted to double Kenya’s foreign debt ceiling from Sh1.2 trillion to Sh2.5 trillion, ostensibly to accommodate new debt for “infrastructure development” in a motion tabled by Mr Duale.

“The Government is involved in massive financing to meet the cost of huge infrastructure projects for development including the implementation of the Standard Gauge Railway which will externally - in a big percentage - be funded from external sources,” he said. Mr Duale also said raising the debt ceiling would help fund the Lamu Port-South Sudan-Ethiopia-Transport project, 10,000km of road construction, 5,000 megawatts in energy projects and one-million-acre irrigation project.

So far, none of the above projects has been able to prove economic viability nor the promise for return on the debt investment. “I want to believe that this is justified,” said Kajiado South MP Judah ole Metito while seconding the motion. “It is a cost that we can afford as a country and it is also worth noting Kenya has not benefitted from any debt relief initiative because of the sound fiscal management of the economy which we encourage the National Treasury to continue doing.”

At the end of the debate that spread over two sessions, 79 MPs voted to raise the debt ceiling and 42 voted against it.  MPs are thus hoodwinking Kenyans by blaming the Treasury CS for the new levy.  

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