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Uhuru has his way on 8pc VAT on fuel in controversial vote by MPs

NEWS
By Moses Nyamori | September 21st 2018
President Uhuru Kenyatta-Address from State House, Nairobi. [File, Standard]

President Uhuru Kenyatta yesterday got his way with a raft of new taxes in a chaotic session characterised by claims of underhand dealings and blackmail in Parliament.

The majority of MPs opposed to the eight per cent value added tax on petroleum products alongside others, were shrewdly defeated by denying the National Assembly the requisite two-thirds majority (233) required to override the President’s recommendations on the Finance Bill 2018.

The controversial vote meant besides the fuel tax, salaried workers will hand a fraction of their pay to the Government to finance a housing project, mobile phone users will incur additional duty and bank transfer costs as the Jubilee administration struggles to plug a budget hole created by rising expenditure and shrinking revenues. 

From a walkout to scuttle any amendments and claims by one member that some of his colleagues had surrendered their electronic voting cards to further bring down the numbers, to others trooping to the toilet, it all pointed to a well-calculated scheme to ensure that the Government carried the day.

Leader of Majority Aden Duale and his Minority counterpart John Mbadi plotted a walkout from the chambers that effectively handed Uhuru a win on the basis of lack of quorum - triggering a fierce row that forced Speaker Justin Muturi to return to the chamber to restore order.

Lost control

The chairperson presiding over the committee of the whole House, where members scrutinise a Bill, clause by clause, had lost control as the session became unruly. At one point, Mr Muturi called for a 15-minute break to review Hansard proceedings to enable him to make a ruling about the legality of the disputed vote that upheld the 8 per cent VAT on fuel.

The walkout by some of the MPs was preceded by a win by the legislators opposed to the tax after they outnumbered their proponents in a vote by acclamation.

Subsequently, all the tax measures were bulldozed against the protesting MPs, effectively dashing the hopes of Kenyans that the National Assembly would protect them from additional taxes.

The MPs who put up a spirited fight were rendered hapless when the Speaker ruled that they had failed to veto Uhuru’s reservation as they lacked the 233 required number, before proceeding to have all the other tax measures sail through.

“The No vote on that clause was lost on the basis that they did not have the required number,” said Muturi referring to the clause on eight per cent VAT on fuel.

There were 215 MPs in the House when a headcount was conducted, effectively handing Uhuru a win over the fuel levy that is expected to trigger a higher cost of living.

But the decision was wildly resisted by the “No” camp, disrupting the session for close to one hour.

All this while, Mr Mbadi, Minority Whip Junet Mohammed, Peris Tobiko, (Kajiado East) and James Gakuya (Embakasi North) among other MPs who walked out, followed the chaotic proceedings from TV screens mounted in the corridors of Parliament.

Some of the MPs who walked out went to have coffee while others hid in the toilets to defeat the cause of their colleague to veto Uhuru’s memorandum detailing why he had rejected the Finance Bill as initially passed by the House.

The high-stake decision saw Uhuru dispatch Jubilee Party Secretary General Raphael Tuju and Vice Chairman David Murathe, who keenly monitored the proceedings in the House.

Some MPs had cited blackmail by their respective parties, which they said had threatened disciplinary action should they have gone against Uhuru and Opposition leader Raila Odinga.

Duale and Mbadi’s attempts to rally the legislators to support the tax was disrupted by shouts of “zero tax!” by the MPs.

Earlier, Duale highlighted the reasons for the President’s reservation, stating that the tax would hand the Government revenue to finance its capital projects as well as deliver essential services.

“I want to speak to both the Yes and No camps that we handle the matter in the interests of Kenyans. It is good for the House to know that at 16 per cent Treasury was to collect Sh35 billion and it was already factored into the budget,” said Duale.

Duale said Government projects would hurt should the tax be suspended, citing other African countries that were charging VAT on petroleum products.

He said South Africa currently charged 14 per cent, Ghana 15 per cent and Nigeria 5 per cent.

“The moment we pass this 8 per cent, ERC (Energy Regulatory Commission) will calculate how much it will be translated into other sectors of the economy. It will say the only transferable cost payable by travellers,” he said.

Mbadi, who had all along opposed the tax before National Super Alliance MPs were finally whipped by Opposition leader Raila Odinga, was cut short when he took to the floor to defend his new position on the tax.

“I am one of the people who was against the levying of petroleum products and for good reason. There is no zero-rating on petroleum products; what we had asked the President was a suspension for two years,” said Mbadi before the House erupted, drowning his remarks.

They spontaneously stood up, shouting, “Zero tax!” and disrupting the meeting for close to an hour.

Soyipan Tuya (Narok), who chaired the session, had a rough time continuing as members stood up and chanted, “Duale must go! Mbadi must go!”

Muturi later took charge of the session but was also greeted with chants of “Zero tax!” and “Muturi must go!” to which he retorted, “Proceed.”

The Speaker was later forced to give the protesting MPs time to air their views on the number of members who had participated in the vote.

Ruaraka MP TJ Kajwang’ said the House met the requisite number at the time they took the vote while hitting out at Duale and Mbadi for leading a walk-out to defeat the process on a technicality.

“When we began the chair had certified that we had the quorum. Duale led MPs out, including my brother whom I respect… it is a shame,” said the MP.

He questioned whether it was in order to conduct a headcount after members had voted and some had walked out.

Nyali MP Mohammed Ali said the decision to reject the tax on fuel was unanimous.

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