Stakeholders appearing before National Asembly Committee on Finance and National Planning Urge Architects of Fiance Bill, 2024 to pity Kenyans
The architects of the Finance Act, 2023 and Finance Bill, 2024 are economic saboteurs.
Unpredictable tax changes create uncertainty for businesses making it difficult to plan for the future and assess potential returns on investment.
Frequent tax shifts by the KK government signals a lack of commitment to long-term economic stability which is discouraging foreign investors who are seeking reliable and predictable economic environments.
Unexpected tax changes has disrupted business operations and undermined the cost of doing business in Kenya especially for import/export companies dealing with complex international tax regulations.
The low predictability of tax rates affecting the import and export sector, is challenging Foreign Direct Investment (FDI) inflows.
Frequent and unanticipated tax policy shifts has created a volatile business climate, eroded investors trust and hindered strategic planning in Kenya.
Such unpredictability, exemplified by abrupt tax rate changes or the introduction of new taxes, directly impacts the cost structures of businesses and complicates tax compliance which will obviously lead to decreased government revenue.
Excessive taxation is killing already struggling businesses, while pushing others to the informal sector, ultimately harming the economy as more traders devise ways to evade.
The black market aptly known as the hidden marketplace, where transactions happen in cash and receipts vanish, threatens to rob the KK government coffers and distort the very economic picture it tries to tax.
With the new Finance Bill, 2024 proposing to tax critical services like mobile money, items like edible oil, bread, the obnoxious motor vehicle circulation tax, and the opaque PayBill 222222, many businesses are now inextricably dumping formal payment systems.
In Economics, laffer curve illustrates a theoretical relationship between the rates of taxation and the resulting levels of the government’s tax revenue.
“You cannot overmilk a cow to prosperity for it will throw a hoaf in desperation”.
Kenya is on the brink of a precipice!