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MPs reject push to scrap VAT on books

NEWS
By Alphonce Shiundu | May 12th 2016

NAIROBI, KENYA: A parliamentary committee yesterday rejected the push to scrap the 16 per cent value-added tax that was imposed on textbooks three years ago.

At a meeting in Nairobi's Parliament buildings yesterday, members of the Finance, Planning and Trade Committee said there was no guarantee that if the tax was scrapped more people will read or that more books will be published.

The chairman of the committee Benjamin Langat (Ainamoi), his deputy Nelson Gaichuhie (Subukia), and members Makali Mulu (Kitui Central) and Daniel Nanok (Turkana West) said "even the publishers do not want books exempted".
They told a petitioner, Mr Njoroge Waweru, a book collector, that they were unlikely to yield to his petition seeking an amendment to the VAT Act, to scrap the 16 per cent tax.

"The publishers do not want books to be exempted. No publisher will seek an exemption, because that means they will not get anything back from the taxes they pay on paper and ink. They all come saying they want books zero-rated so that they can claim tax refunds on input. But that's not the direction we want to go," said Gaichuhie.

Njoroge had told MPs that the tax had made books very expensive, and had discouraged many people from reading, and even university scholars were not publishing extensively.

"If you remove the tax, more scholars will publish and the government can collect taxes by targeting royalties and the pay that will be made by the many publishing editors who will be employed," Njoroge told MPs.
But the MPs rejected the theory.

"That is not true. It is not automatic!" said Nanok.

Makali said the accessibility of books was not a prerequisite for reading.

"The petitioner is telling us that if we remove VAT on books, then books will be accessible and more people will read. But that's not a fact. The reason why we have been taxing books is because we need resources. Taxation is a necessary evil," said Makali.

The National Treasury slapped a 16 per cent tax on text books in 2013, and publishers have been complaining that the tax, plus rising cost of paper, pushed the prices of books up significantly.

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