Anglican Archbishop of Jackson Ollie Sabet has petitioned Parliament to abolish punitive taxes that directly affect the poor and vulnerable.
He told the National Assembly's Finance and Planning Committee that the proposed taxation would disproportionately affect those with the least ability to pay.
Mr. Oli Sabit appealed to the committee to delete all provisions in the Finance Bill 2024 that propose to impose taxes on bread, cooking oil, offerings, altar wine, financial services, diapers, sanitary pads, medical dressings, sugarcane transportation, agricultural pests and electricity. Motor vehicles, motor vehicle tax.
“Increasing taxes on basic goods and services will lead to higher costs of living, making it difficult for low-income families to afford necessities,” Uli Sabet said.
“Additional tax burdens will push more people into extreme poverty, widening existing inequality and entrenching vulnerabilities.”
The Treasury proposed imposing a 16% value-added tax on bread, a 25% excise duty on vegetable cooking oil, and a 16% value-added tax on financial services, in addition to increasing duties on financial services from the current 15%. To 20 percent.
The bill also seeks to impose a 16 percent value-added tax on forex transactions and check processing, as well as a 10 to 20 percent increase in the cost of MPesa and money transfer fees.
The Treasury also proposes an annual motor vehicle tax of 2.5% based on the value of the vehicle and an environmental tax of Sh150 per kilogram on all items made from plastic packaging.
The Treasury seeks to net at least Sh58 billion from the car tax. The Finance Bill 2024 seeks to raise a total of Sh302 billion to fund the Sh3.9 trillion budget for 2024/25.
In a lengthy presentation that culminated in a prayer for committee members, Mr. Uli Sabit asked lawmakers to avoid increasing taxes on essential goods and services, including bread and vegetable oils.
“Implementing targeted tax relief measures for low-income individuals and companies, especially SMEs, to support their recovery and growth after Covid-19,” said Mr. Uli Sabit.
“Bread is the staple food of Kenyans, especially those living in low-income households. Increasing the cost of bread through VAT will directly worsen the cost of living, deepen poverty, and increase vulnerability among the population.
Mr Olli Sabet asked MPs to remove altar wine and unleavened bread from the list of items subject to the 16 percent value-added tax.
“There should be some sort of warning about things like unleavened bread and altar wine. You should help us by removing the altar wine from other types of wine on the shelves and unleavened bread from other types of bread so that we can focus on giving Kenyans Holy Communion,” Mr. Ole Sabet said. Let the rest enjoy plain bread and wine.”
The Anglican archbishop said imposing a 25 percent excise tax on vegetable oils, including raw materials and refined products, would greatly impact low-income families, increasing the cost of living and reducing their disposable income.
He said that imposing a 16 percent value-added tax on transporting sugarcane from farms to milling plants will directly raise the final production prices that consumers will bear.
He said: “As the cost of locally produced sugar rises, its competitiveness against cheaper imported sugar will decrease.”
The Anglican Archbishop asked the representatives to cancel the proposed tax on cars, which amounts to 2.5 percent of the value of the car, saying that it would increase the cost of owning and operating a car.
“Public transport operators may pass on additional costs to passengers, which increases transport costs,” said Uli Sabet.
“This may also lead to job losses in the transportation and logistics sector and discourage investments in the automobile industry.”
Mr. Olli Sabet asked the committee to scrap proposals to impose an environmental tax and value-added tax on electric cars, bicycles and lithium batteries.
He also asked the committee to conduct a comprehensive study to understand the potential economic and social impacts, especially on low-income groups and small and medium-sized companies, before implementing the tax increases.
He also recommended exploring ways to implement strict measures to reduce government waste and embezzlement of funds.
