Earth Science News
AFRICA NEWS
Fake nails, fuel and influencers in Kenyan taxman's sights
Fake nails, fuel and influencers in Kenyan taxman's sights
By Hillary ORINDE
Nairobi (AFP) May 19, 2023

What do artificial nails, crypto currencies, spaghetti and social media influencers have in common?

They are all being targeted by Kenya's taxman in a raft of new proposals aimed at filling the coffers of President William Ruto's cash-strapped government.

Ruto is seeking to repair a heavily-indebted economy inherited from his predecessor Uhuru Kenyatta, who ramped up borrowing to fund a splurge on costly infrastructure projects.

Despite pledging to improve the lot of impoverished Kenyans during last year's election campaign, Ruto is now taking the politically unpopular step of raising taxes.

Ruto's government has drawn up a 3.6-trillion shilling ($26.2 billion) budget for 2023/24 with the proposed new taxes expected to generate 289 billion shillings.

Opponents have warned the measures will hit small businesses at the very heart of the economy as well as households struggling to make ends meet in the face of soaring prices and deep-seated poverty.

"It will affect our livelihood because life is already difficult," said Rebecca Nyalesa, 45, who has been a hairdresser for 30 years.

"Every time you go to the shop, you find prices have gone up. But our earnings haven't increased. Life is very difficult."

She said her Nairobi salon was already suffering from a drop in customers and feared worse was to come with plans for taxes on all manner of beauty products including wigs, false beards, fake eyelashes and nails.

"Back in the day, I could braid six people in a day, but now it's down to two or three."

Mother-of-two Rose Achieng, 29, said she used to get her hair done three or four times a month but now it's just once.

"We are headed to the stage where you have to decide if you have to do your hair or buy food."

- Debt mountain -

East Africa's most dynamic economy has been hit hard by a regional drought and the fallout from the Ukraine war that sent inflation soaring and GDP growth sliding.

The central bank in March trimmed its 2023 GDP forecast to 5.8 percent, slower than the 6.1 percent predicted earlier.

Kenya is also labouring under a $70 billion debt mountain, spooking credit ratings agencies including Moody's which last week downgraded the country's sovereign debt rating further into junk territory.

Ruto insists he is making the "right decisions" to get the economy and government finances back on track in the face of pressure for reforms from the International Monetary Fund (IMF).

"Many people are saying you can't tax yourself into prosperity and that is correct, but you cannot accumulate debt into bankruptcy as an option," he told reporters Sunday.

"We are not overtaxing ourselves."

- 'IMF playbook' -

Kenyan economist Reginald Kadzutu told AFP the finance bill appeared to have come from the "IMF playbook".

"When you are near debt default, and you might have to negotiate, you have to prove that you have enough revenue-generating capacity and the only way is to tax anything that has a figure on it."

One of the more controversial provisions is a three percent deduction on the salaries of all tax-paying Kenyans to fund an affordable housing programme.

Among foodstuffs, imported fish, locally manufactured sugar confectionery, powdered juice and locally produced pasta will attract new excise duty.

The government also plans to double value-added tax on most petroleum products to 16 percent.

Retail prices of fuel already jumped this week by up to nine percent after the government scrapped kerosene and diesel subsidies.

Other proposals include a three-percent tax on the transfer of digital assets such as crypto currencies and an increase in tax on gambling to almost 20 percent of the amount wagered.

Social media influencers and content providers have not been spared either, with their earnings facing a 15 percent tax.

- 'Tsunami of taxes' -

Veteran opposition leader Raila Odinga is threatening to call Kenyans back onto the streets over what he has branded a "tsunami of taxes".

Earlier this year, he led a series of sometimes deadly anti-government demonstrations over the cost-of-living crisis, claiming that victory was stolen from him in last year's election.

"We will have no option but to mobilise all the social sectors and take all the necessary political actions to stop this blow and burden," Odinga said.

There had been speculation of a rapprochement between Ruto and his arch rival after the two men were spotted together at three events at the weekend.

But Odinga has dismissed talk of any "handshake" with the president, referring to a surprise alliance he forged with Ruto's predecessor Kenyatta in 2018 that changed the political landscape.

The public has until May 20 to comment on the finance bill before it is debated by lawmakers. If passed, it will need presidential approval to become law.

For 52-year-old motorbike courier Josiah Burudi, Ruto has reneged on his promise to improve the lives of ordinary Kenyans or so called "hustlers".

"It's like we are being taken for a ride. Life is becoming worse."

ho/txw/amu/giv

MOODY'S CORP.

Related Links
Africa News - Resources, Health, Food

Subscribe Free To Our Daily Newsletters
Tweet

RELATED CONTENT
The following news reports may link to other Space Media Network websites.
AFRICA NEWS
33 civilians killed in Burkina Faso 'terrorist' attack
Ouagadougou (AFP) May 14, 2023
At least 33 people were killed when gunmen opened fire on vegetable farmers in a jihadist-hit region of Burkina Faso, the governor said Saturday, as the country struggles to stem an insurgency. A state of emergency has been in force in eight of Burkina Faso's 13 regions since March, including in western Boucle du Mouhoun. The attack on the farmers happened on Thursday evening around 5:00 pm (1700 GMT), Governor Babo Pierre Bassinga said in a statement. "The village of Youlou in the departme ... read more

AFRICA NEWS
Automated agricultural machinery requires new approaches to ensuring safety

The number of the world's farms to halve by 2100, study shows

UConn researcher explores impact of recreational homes on agricultural land use

Another step away from the farm: meat grown from immortal stem cells

AFRICA NEWS
States reach consensus on Colorado River Basin water conservation deal

New non-toxic powder uses sunlight to quickly disinfect contaminated drinking water

Water woes shake up Spain's election campaign

Myanmar residents hunt for water as UN asks junta for access

AFRICA NEWS
Frigid US city becomes haven in climate change era

Meteorologists targeted in climate misinfo surge

Greenpeace, islanders launch legal action against Dutch

Spain to spend 2.2 bn euros to tackle drought

AFRICA NEWS
Driving on sunshine: clean, usable liquid fuels made from solar power

Boosting solar cell energy capture efficiency with a fullerene-derivative interlayer

China builds massive solar park to reduce carbon footprint

Ten month voyage proves solar cell material survives, thrives in space

AFRICA NEWS
WVU researcher searching for 'holy grail' of sustainable bioenergy

New catalyst transforms carbon dioxide into sustainable byproduct

Researchers cultivate microalgae for biofuel production

3D-printed biodegradable seed robot can change shape in response to humidity

AFRICA NEWS
China calls on Australia to boost ship search efforts

Colombian soldiers hunt for children who survived air crash

El Salvador military surrounds town after police killing

Chinese fishing vessel capsizes in Indian Ocean with 39 missing

AFRICA NEWS
Consumer anxiety holds gasoline prices in check

Greenpeace says Russian decision to outlaw it 'absurd'

China enters Sri Lanka's domestic fuel market

Gulf oil giants turn to start-ups in carbon-capture bid

AFRICA NEWS
G7 vows economic coercion will 'face consequences'

Markets struggle despite 'productive' Biden-McCarthy debt talks

Cannes gets rare look at real life in Chinese factories

Biden says US, China should see a 'thaw very shortly'

Subscribe Free To Our Daily Newsletters




The content herein, unless otherwise known to be public domain, are Copyright 1995-2024 - Space Media Network. All websites are published in Australia and are solely subject to Australian law and governed by Fair Use principals for news reporting and research purposes. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA news reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. All articles labeled "by Staff Writers" include reports supplied to Space Media Network by industry news wires, PR agencies, corporate press officers and the like. Such articles are individually curated and edited by Space Media Network staff on the basis of the report's information value to our industry and professional readership. Advertising does not imply endorsement, agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. General Data Protection Regulation (GDPR) Statement Our advertisers use various cookies and the like to deliver the best ad banner available at one time. All network advertising suppliers have GDPR policies (Legitimate Interest) that conform with EU regulations for data collection. By using our websites you consent to cookie based advertising. If you do not agree with this then you must stop using the websites from May 25, 2018. Privacy Statement. Additional information can be found here at About Us.