MPs’ tax ‘a ploy to shift focus away from Budget’

Queries have emerged about the perennial resurgence of the tax debate every time the national Budget is under the scrutiny of the august House.

The doubts come at a time when the public, together with the taxman, are all focused on ensuring that the lawmakers relinquish one- third of their hefty perks to the Exchequer, following the promise of the 10-month-old Constitution obligating all public officials to pay tax on their income.

Mr James Shikwati, a renowned economist, and an MP, Mr John Mbadi (Gwassi, ODM) now say that it is possible that “the furore over the Budget should have been sorted out in September last year”, Mr Mbadi, who sits in Parliament’s Budget Committee that is scrutinising the Budget, told the Nation.

He termed the taxation issue as an “old story that keeps popping up” to ensure that MPs do not have all their thoughts on the Budget.

“Why do these things happen every year just after the Budget is read?” he posed.

The Parliamentary Service Commission received the letter from the Kenya Revenue Authority seeking to tax the MPs’ allowances on June 8, 2011, the very day that Finance minister Uhuru Kenyatta read the Budget in Parliament.

There had been a stand-off between Parliament and the Treasury about when the provisions in the Constitution to do with the Budget-making process take place.

Mr Shikwati echoed Mr Mbadi’s sentiments, saying that Kenyans have to remain vigilant in the on-going scrutiny of the Budget, because the way it was playing out it seemed to have all the shades of “diversionary tactics”.

“This debate is trying to cover-up the huge hole in the Budget. This is a smoke screen; a diversion. The public is being deceived to believe that MPs have finally been cornered, but the truth is, there’s something that is being sneaked through in the Budget estimates currently with Parliament,” Mr Shikwati told Nation Media Group’s Q-FM.

He chimed the thoughts of a senior parliamentary employee who wondered why it was the Commissioner of Domestic Tax, Mr John Njiraini talking on behalf of KRA, and not the Commissioner General Michael Waweru.

“It’s probably the reason the minister of Finance (Mr Uhuru Kenyatta) has no time to talk about this issue,” said the economist.

While the issue of taxation of MPs’ perks is crucial at a time when the country ought to be mobilising funds for the Sh1.2 trillion Budget, the estimates have to be looked at with a toothcomb to ensure that there’ll be no wastage this time round.

Accordingly, the National Taxpayers Association, has already lobbied Parliament’s Budget Committee to reduce the recurrent expenditure and allocate the money to the development Budget to help in the quick development of infrastructure.

Mr Davis Adieno , the NTA’s national coordinator, cited the Department of Defence, the Ministry of Education and the Ministry of Provincial Administration as some of the ministries who got huge amounts of money, but went ahead not to use it at all.

He said the Ministry of Education in the last fiscal year failed to use Sh23.5 billion, meaning that money was returned to the Treasury when it could have done meaningful work on the ground.

“This money would have constructed 47,000 standard classrooms, that is, at least two classrooms per school for all the 21,000 public primary schools. This is totally unacceptable,” said Mr Adieno.

He added that it was wrong for policemen to languish in poor houses, without equipment and without adequate pay, at a time when the Ministry of Internal Security has Sh11.3 billion lying unused in its coffers.

“This money can be used to buy equipment, so that when we call our police stations, they don’t tell us they don’t have fuel,” said Mr Adieno said in his submissions to the Budget Committee last week. The hearings continue.