Treasury and National Planning Cabinet Secretary Amb. Ukur Yatani is this afternoon set to present this year’s Ksh3.66 trillion budget in the National Assembly.
This year’s budget which is Ksh750 billion more than last year’s budget is expected to see the introduction of taxes on basic goods such as bread and cooking gas.
To increase revenue collections, the National Treasury is proposing to introduce tax on some products that were previously zero-rated such as bread and cooking gas that is expected to attract 16 per cent VAT.
In addition, commercial banks would be liable to pay VAT on loan loss provisions. The National Treasury has also proposed to introduce excise duty on motorbikes at the rate of 15 per cent.
In addition, there are concerns about how the additional cash would be raised amid a ballooning public debt and shortfalls in the revenue collections.
However, Kenyans are optimistic that this year’s budget would be a people-centred budget.
Lowering the cost of living and investing in small businesses are some of the things Kenyans want to be prioritized.
On Wednesday the National Assembly Budget and Appropriations Committee proposed an upward review of the debt ceiling to enable implementation of this year’s budget.
Committee chair Kanini Kega indicated that by end of March this year the stock of public debt was Ksh7.34 trillion which is 82 per cent of the current Ksh 9 trillion national debt ceiling.
There have been proposals that the country’s debt ceiling be increased to Ksh12 to offer the government room to borrow money to finance development projects.
Yatani has defended the government’s borrowing, saying it s within the ceiling and that if it doesn’t do so, it will have to tax Kenyans more.
“Our debt ceiling is within the ceiling we set for ourselves, the scope is narrowing,” he said during an interview with the local TV station.