Preparing for the 2023 Finance Bill: Insights from Economists
As taxpayers prepare for the new burden that will result from the passage of the Finance Bill 2023. Economists have provided insight into some of the adjustments Kenyans will be required to make.
Vincent Kimosop, an economist, spoke to GossipA2Z about three ways Kenyans could adapt and survive the high cost of living.
He observed that two tools are used to manage the economy. First, there are fiscal instruments, such as the Finance Bill, that are used to control government spending.
He noted that the Central Bank of Kenya uses the second set of tools to manage the country’s money supply.
Kimosop stated, however, that Kenyans retain the ability to make decisions. That can assist them in managing their finances on a personal level.
“There are two tools available for managing the economy: fiscal tools, which the government employs, and monetary tools, which the Central Bank employs.
“However, on a personal level, there are also things you can do within the economy, as economics has multiple principles,” he said.
Eliminate a Luxury Lifestyle
The first thing he mentioned that Kenyans had to do was give up luxury living. He emphasized that the focus should be on essentials and cautioned against spending arbitrarily. According to him, saving money is beneficial in the long run.
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Kimosop stated, “The lifestyle should also change, and people should stop consuming high-end products and prioritize primary goods.”
Bornventure Nyangor, an economist, echoed his sentiments when he cautioned that Kenyans will earn much less in the future due to the government’s new taxes.
In light of recent events, he cautioned that Kenyans would have little wiggle room to stock up on their preferred luxury brands.
It has nothing to do with your employer, as the government will be taking a larger portion of your salary. You will have less money,’ he remarked.
Find Substitutes for Food
The experts explained that Kenyans needed to investigate ways to save more money, such as adjusting to alternative foods.
One of the options available to Kenyans, according to Kimosop, is to choose less expensive meals with the same nutritional value. For instance, selecting a different type of protein that is more economical.
“You should alter your consumption of particular items. People can seek alternatives; for instance, if they are accustomed to eating meat, they can look for a substitute protein.
According to Nyangor, taxpayers would be required to make this sacrifice to maximize their reduced income.
Companies That Manage Their Costs
In addition, Kimosop predicted that if Kenyans spend wisely and refrain from purchasing luxury brands, businesses will be forced to manage their costs.
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“Also, as a result of the shift in the operational environment, it will be essential for affected businesses to manage their costs,” he added.
On Monday, June 26, President William Ruto signed the Finance Bill 2023 into law during a brief ceremony at the State House.
Deputy President Rigathi Gachagua and Prime Cabinet Secretary Musalia Mudavadi were among the other senior government officials present at the event.
National Assembly Majority Leader Kimani Ichung’wah also witnessed the president sign the bill into law. Ichung’wah was the bill’s chief advocate in the legislature.
Preparing for the 2023 Finance Bill: Insights from Economists
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