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ELECTION 2022

ODM joins calls to oppose Yatani's plan to tax basic household goods

POLITICS
By Josphat Thiong’o | Apr 14th 2022 | 3 min read

Leader of Minority John Mbadi addresses a press conference in Parliament, on April 13, 2022, in Nairobi regarding the recent budget April and taxations of basic commodities.[Edward Kiplimo,Standard]

Political protagonists have united against attempts by the government to introduce taxes that will drive up the cost of basic commodities.

Yesterday, ODM chairman John Mbadi said members who served in the Budget committee had been instructed to shoot down proposals in the Finance Bill seeking to increase the price of goods such as maize and wheat flour, milk and bread.

The Bill presented by the Treasury Cabinet Secretary Ukur Yatani last week in Parliament proposes to introduce 16 per cent VAT on wheat, cassava flour and maize.

Mr Yatani has also proposed an increase in taxation of motorcycles and bottled water so as to finance the Sh3.3 trillion Budget.

“Our members in the Finance committee have briefs that any proposal that would make any basic or essential commodity more expensive than it is today be done away with totally. The government has for instance proposed to remove unga from zero-rating and this will definitely be rejected by us because this hurts the consumer,” said Mr Mbadi.

“…the reality is that bottled water has ceased to be a luxury and is now a necessity and we may decide to reject the proposal to hike the taxation. The increase in taxation for boda boda is modest but it is also about sending the wrong message that the prices of motorbikes should be increased.”

The National Assembly Leader of Minority was concerned that the country’s economy was already under a lot of stress and there were signs of looming inflation if no measures are taken.

Deputy President William Ruto’s Kenya Kwanza Alliance has also criticised the proposals.

Dr Ruto declared he will rally troops to shoot down the Bill and if that failed, he would scrap it should he be elected president in the August 9 elections.

But the Raila Odinga party yesterday accused the Deputy President of playing populists politics.

Mr Mbadi hit out at Ruto for claiming that President Uhuru Kenyatta and Raila conspired to raise the cost of living.

Promising the impossible

“Ruto should stop political conmanship and be honest to Kenyans. We are not keen on seeing an increase in the cost of living. He is a deceitful leader, willing to get power at whatever cost. Instead of politicking in rallies, he should join other Kenyans in finding solutions to our problems.”

Other issues that ODM and its rivals are opposing is the proposal to introduce third party insurance cover for boda boda motorcycles.

But there are questions whether it is possible, like Kenya Kwanza Alliance says, to scrap the entire Budget even by a president.

According to the law, it is possible to reject the Finance Bill albeit on explicit conditions.

Ruto allies in Parliament can ensure that the Bill is rejected, or they choose to amend the contentious clauses and send it back to the Treasury to effect proposed amendments before the Bill is tabled again in the House.

Former Wajir Senator Billow Kerrow argues that since the Finance Bill will be presented through a Motion, members will be at liberty to shoot it down by a simple majority.

“The effect of such action will not be felt immediately by the Government till July when the current 2021/22 financial year ends. Even then, Government can still draw 50 per cent of the proposed allocations until the appropriations are approved,” said Mr Kerrow.

“Regarding amendment, the MPs can reduce or increase allocations to a vote in the Appropriations Bill by 10 per cent only. Later, they can make larger amendments through Supplementary budget.”

On whether the Azimio la Umoja One Kenya allied MPs will fight the attempt to reject the Bill, he said: “It depends on the turnout for the vote on the Motion. Based on recent votes on the election amendment law, it will, however, be unlikely for the budget Motion to face a defeat in the House.”

Lugari MP Ayub Savula dismissed the bid by the Ruto allied MPs to reject the Budget terming their actions as sideshows.

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