‘Kenyans Are Not Being Over-Taxed’: Mudavadi Defends Government’s Tax Regime
Prime Cabinet Secretary Musalia Mudavadi has stated that the tax system in the nation isn’t overly harsh.
Mudavadi expressed that the actions taken by the tax authority are intended to stabilize the government’s revenue collection in response to the economic hardship currently faced by the country.
Mudavadi stated that for the nation to improve its current predicament, Kenyans need to adopt the practice of generating their income. He also mentioned that the Government is actively addressing loopholes that facilitate tax evasion.
“There is no country that grows and becomes economically stable without taxing its people. The government gets its revenue to undertake its functions only through borrowing, which leads to debts and taxes collected from its people. Even in developed countries nobody likes or enjoys paying tax. But that remains the rule of thumb for a country to sustain itself,” Mudavadi said.
Mudavadi stated that it is time for Kenyans to be patriotic, stressing that while there is agony today, there is light at the end of the tunnel.
He noted that no government is delighted to overburden its population with taxes and that if things settle and return to the road of economic growth, Kenyans would be relieved under the tax system.
“We are working hard as a government to seal the loopholes of tax evasion even as we look for other avenues on how we can generate revenue. What we are encouraging and working on is expanding the tax bracket and not increasing taxes. That is why we are looking for opportunities for creating more jobs so that many people can be enrolled in the tax payment quarter,” said Mudavadi.
According to Mudavadi, the government’s efforts to simplify domestic revenue collection would assist in stabilizing the current tax levels in the long term.
Mudavadi, who is also the Cabinet Secretary for Foreign and Diaspora Affairs, stated that Kenya is developing its diaspora as a critical pillar in improving the country’s economy, noting that current remittances from the Kenyan Diaspora are highly encouraging.
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“What the country is collecting from Kenyans living abroad at the moment is almost surpassing our export targets. This is a key indicator that we need to have a stable foreign policy that will help us further our partnerships with other countries since we have seen this forms part of what helps us grow our country economically,” said Mudavadi.
Mudavadi, speaking to a local radio station, also backed the government’s proposal to privatize some state-owned firms and parastatals.
He stated that under the now-enacted Privatization Bill, 2023, the government is permitted to privatize non-strategic performing state-owned enterprises whose returns will help add value to cater for support in other key areas of the economy such as infrastructure in transportation, water, health, and education.
According to Mudavadi, all actions must be based on the law to prevent raising concerns among Kenyans.
“What we want to encourage is proper management of these state-owned parastatals for them to generate revenue instead of government pumping in money day in day out to sustain them. Kenyans should take a leaf on what happened to KCB which was 100 percent owned by the government some years ago and what happened at Kenya Posts and Telecommunications Corporation (KPTC) a government company that provided telecommunication and postal services across Kenya,” said Mudavadi.
Mudavadi says Safaricom, which is the leading company in revenue remittances in the country was a result of privatization at KPTC citing the need to look at the bigger picture of return on investment.
‘Kenyans Are Not Being Over-Taxed’: Mudavadi Defends Government’s Tax Regime