Proposed Ksh3.07 trillion Kenya’s budget estimate attracts criticism

Written By: Hallygan Agade
2002

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The proposed 3.07 trillion shillings 2018/2019 budget has attracted sharp criticism from various groups with the Kenya Fight Inequality Alliance saying that it is a budget that caters only for the rich in the country.

The group says that the trend has been set where the annual budget no longer addresses the most basic needs of the majority poor.

“Faced with a fiscal crisis as a consequence of graft and over borrowing, the Government is choosing to balance the books on the backs of the poor people, by increasing the cost of basic goods for instance food” The alliance says.

The alliance argues that annual budget estimates is a golden opportunity for the government to design ways of helping to close the perennial gap between the rich and the poor by taxing the rich more than the poor and allocating more funds to free universal health care, education and reducing tax on commodities like food stuffs.

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Wanjiru Njoroge from the Daughters of Mumbi Resource Center says the budget has never worked for the small scale women traders especially in the slums who need the tax breaks more than the Kenyan tycoons.

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She says that most of these women in the slums are forced to pay huge amounts of money on licenses yet the Government in the budget estimates does not always factor in this group of people in the society.

“These women work hard and the little they earn is taken away   by the tax man” Wanjiru says.

She adds that for the country to realize a pro-poor budget, the national treasury must come up with proper mechanisms for citizen-participation during the entire budget proposal process.

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Wanjiru says the budget instead has given subsidies to large scale farmers for instance leaving out the majority who are small scale farmers in the country.

According to the National Treasury the 2018/2019 budget proposal is focusing majorly on the big four agenda that is manufacturing, food security, universal health care and affordable housing.

However the Kenya Fight Inequality Alliance   says as much as this is a positive step towards development, the budget must invest in the basic needs as well because most mega projects have been turned into a cash cow for the few selfish people.

The alliance claims that Kenya’s Value Added Tax which is currently at 16 percent and with reports indicating that it might shoot up is hurting the poor with most wealthy individuals and big companies already cushioned as a result of tax breaks.

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The alliance added that corporations in Kenya get tax breaks worth 33 billion shillings according to the World Bank, meaning Kenya is spending twice as much on tax breaks for corporates as it is on free Primary Education.

They say that unless the Government changes the way the budget process is undertaken, there will always be inequality for generations to come.

According to Oxfam International, extreme inequality is out of control in Kenya. Less than 0.1% of the population (8,300 people) own more wealth than the bottom 99.9% (more than 44 million people).

Therefore in its five-point action plan to fight inequality it proposes that tackling inequality could help to lift millions out of poverty, secure sustainable economic growth and bring the country together. Inequality is not inevitable and the government can reduce it to sustainable levels.

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