……………..The Kenyan citizenry world is slowly crumbling down due to the challenges and stumbling blocks he is encountering in his life. His life is full of gaping holes occasioned by the rising cost of living coupled with hard economic times which is putting them in the dire constraint of a financial burden……………..

……The Kenyan citizenry world is slowly crumbling down due to the challenges and stumbling blocks he is encountering in his life. His life is full of gaping holes occasioned by the rising cost of living coupled with hard economic times which is putting them in the dire constraint of a financial burden.

The Governments’ petite for monies haven’t helped him either as the Government is keeping its tax finger right into the already burdened taxpaying Kenyan. It’s tightening its belt by increasing taxes to finance its ambitious budget which has a deficit.

The Governments’ ambitious budget estimates have forced it to widen its tax bracket into areas it traditionally considered as too sensitive to warrant it’s inclusive into the tax bracket. And, this time around they were incorporated in the tax bracket proposals.

Any proposal to tax this sensitive area were considered to be a burden to the already burdened taxpaying Kenyan. Thus, these areas were excluded from the tax bracket over time as it circles around most basic commodities.

And, as the Governments’ petite for monies continued to increase with each an every year’s budget proposal estimates to astronomical figures the more the Government extended it’s tax bracket so that it can finance its major infrastructural projects and it’ recurrent expenditure.

The government has been forced to source funds from areas it shied away from taxation and that’s why it kept on extending its tax bracket. Its’ petite for monies coupled by budget deficits always forces the Government to enter into our markets on a borrowing spree seeking funds to breach the budget deficit.

And, recently our rising debts and borrowing spree has come under a microscopic focus due to what is presumed as ballooning debts especially the Chinese loans. It is being argued that we are galloping these Chinese loans at an alarming rate, that at the end of it all we might not be able to repay these loans in the near future.

The growth in the public debt has raised concern that the ballooning repayment costs are hurting economic activities by taking up a large chunk of Government revenue. The increased debt has seen Kenya commit more than half of it’s taxes to repaying loans, leaving the state with little cash for development.

The Jubilee government has increased spending since 2013 to build new roads, a modern railway, bridges, electricity plants and financing the devolved government units, thus driving up borrowing to plug the budget deficit.

And, the government has always been toying with the proposal of widening the tax bracket and the proposal on imposing a Value Added Tax on petroleum was hatched in 2013, although the proposal was shelved to allow more engagements.

But, in this year’s budget estimates the proposal was inserted to widen the tax bracket which precipitated a public outcry with the resultant being felt across the country. The Members of Parliament had rejected that proposal when they were reviewing the Financial Bill.

When the Financial Bill was presented to President Uhuru for accent, he flatly rejected it and he returned it to Parliament with a memorandum outlining his reservation.

While he was addressing the Nation after he rejected to accent to the Financial Bill, he called it a necessary bold decision to balance between short-term pain and long-term gain.

According to Daily Nation columnist, Macharia Gaitho, while commenting on the issue, wrote that Uhuru Kenyatta, displayed a great deal of leadership, and, resolve in bludgeoning a reluctant National Assembly against shooting down his veto on the petroleum tax proposal.

He had to make what he knew was an almost universally unpopular decision but one that he considered absolutely necessary for the budget.

Mr. Gaitho pointed out that, that’s what leadership is about. One must make decisions that will be vital for the long term, even if they are painful and unpopular with the voters. It is only shortsighted and insincere leaders who will always play to the gallery with populist measures that will please the cheering crowds but will eventually have disastrous consequences.


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