Nakuru County Governor Lee Kinyanjui has lauded the economic interventions announced by President Uhuru as a way to cushion businesses and individuals during this period when the COVID-19 pandemic has halted several operations.
During his National address on Wednesday evening, the president announced 100 % Tax relief for persons earning a gross monthly income of up to Ksh. 24,000. He also stated that there will be a reduction of Income and resident Tax from 30% to 25%.
Other changes announced include reduction of the turnover tax rate from the current 3% to 1% for all Micro, Small and Medium Enterprises (MSMEs). The president also suspended the listing with Credit Reference Bureaus (CRB) of any person, Micro, Small and Medium Enterprises (MSMEs) and corporate entities whose loan account fall overdue or are in arrears, effective 1st April 2020.
Uhuru also introduced the appropriation of an additional Ksh. 10 Billion to the elderly, orphans and other vulnerable members of our society through cash-transfers by the Ministry of Labour and Social Protection.
Kinyanjui on his part believes the measures were well thought. He is confident that the reduction on VAT will help ailing businesses to stabilize beside reducing the cost of living.
“We salute the economic interventions announced by the President. The measures are well thought and geared towards the protection of the economy at these difficult times. In particular, the reduction of VAT will go a long way to protect ailing businesses and reduce the cost of living. These are pro-business proposals that reflect the government’s commitment to the economy,” he stated.
The Governor added that without such interventions, several companies were headed for closure and that would render many Kenyans jobless.
Kinyajui hopes that the Kenya Revenue Authority will follow suit and moderate their approach to taxation.
“We hope to witness a change in their harsh and terror-like approach to business people. The realization that taxation grows along with the economy and that when businesses close, they pay no tax, is critical to forging a new beginning,” he adds.