Public Participation in Finance Bill 2023: A Meaningful Impact or Mere Formality?
The National Assembly Finance Committee either disregarded or rejected the opinions of the vast majority of those who opposed the Finance Bill 2023 in its entirety during the Public Participation Stage.
The vast majority of submissions from various entities and individuals vehemently opposed the contentious bill, primarily the housing levy and 16% VAT increase on petroleum.
The report submitted by the committee led by Kimani Kuria appears to have incorporated none of these perspectives. Did the Public Participation Sessions have any significance?
Among the 1080 memoranda received by the National Assembly Finance and Planning Committee during the 9-day Public Participation Stage of the Bill were submissions from members of the public representing various economic sectors, such as agriculture, manufacturing, and labor.
The initial 3% proposed Housing Levy and the 16% VAT on Petroleum products were among the most contentious provisions among stakeholders.
In its submission, the Kenya Association of Manufacturers (KAM) advocated for the deletion of Clause 76, which addresses the Housing Levy, due to the need for a framework to guide the implementation and administration of the levy.
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The association argued that the Housing Levy requires additional consultation so that the public can comprehend its purpose.
“If this bill passes, we will see an industrial mass exodus of investors to countries such as Egypt and South Africa due to double taxation on manufacturing products, such as the taxation of Klinker used to produce cement,” KAM said in a statement.
The committee observed that the proposal for the housing fund was changed from a mandatory contribution to a tax and that the rate was reduced from 3 percent to 1.5 percent.
“We will amend the bill to incorporate Kenyans’ concerns. Kuria Kimani, chair of the Finance and Planning Committee of the National Assembly, stated to the House, “Remember, at the end of the day, we have a budget to facilitate, which depends on this bill.”
There were 137 objections to the entire Finance Bill 2023.
The Finance Committee acknowledged 89 email submissions, of which 87 opposed the introduction of the Housing Levy and only 2 supported it because it would generate employment.
According to the Media Owners Association, “the bill will have severe negative effects on the advertising industry, which is the primary source of revenue for mainstream media.”
In its report, the Finance Committee acknowledged receiving opposition from nine parties to the introduction of the 16% VAT on fuel.
On multiple occasions, the chairman of the Departmental Committee on Finance and National Planning Committee had stated that the views of stakeholders on the Finance Bill 2023 would be taken into account, promising that the public participation phase of the bill would not be empty rhetoric.
The Committee spent a week in Naivasha compiling a report. What exactly changed during this time?
Public Participation in Finance Bill 2023: A Meaningful Impact or Mere Formality?
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