Treasury Cabinet Secretary Henry Rotich (fourth left) and National Assembly Speaker Justin Muturi (third left) join the Senate choir at Parliament Buildings Thursday. [Boniface Okendo, Standard]
NAIROBI: The 2017-18 budget, which for the first time came before June, contained a surprise taxation plan despite the expected expenditure widening to Sh2.6 trillion.
With the rest of the East African Community yet to read their budgets, the Jubilee administration’s last budget before August 8 polls has come with economical tax plans.
Apart from putting a huge gamble into the ‘sinful’ world of gamblers and imbibers of spirits, the Government was generous with tax exemptions as opposed to imposing new taxes.
Treasury said on matters relating to customs, it had evaluated various proposals from stakeholders for consideration by the EAC ministers for Finance in June.
“Measures that will be agreed upon by the EAC ministers for Finance on matters relating to customs will be communicated through the EAC Gazette and implemented from July 1 this year,” said National Treasury CS Henry Rotich.
In addition, Rotich told Parliament EAC Common External Tariff, which sets out rates of duty applicable on imported goods, was undergoing a review and the final outcome would be released once adopted by the EAC Council of Ministers.
This means more tax measures may come after the rest of members have laid bare their plans.
In its budget, Kenya wants to collect Sh1.7 trillion from tax payers, borrow Sh524.6 billion and count on donors and private sector to come in with close to Sh375 billion.
The budget plug, equivalent to 6 per cent of GDP, will be financed from external borrowing of Sh256 billion and Sh268.6 billion and Sh268.6 billion from the domestic market. “This will be mainly on concessional terms. Non-concessional external borrowing will be limited to projects with viable expected returns and the ceilings in the Medium Term Debt Strategy,” said Rotich.