Dispute deepens as KRA refuses to budge on MPs’ tax
Photos/HEZRON NJOROGE and FILE
Commissioner for Domestic Taxes John Njiraini. KRA expects to collect Sh700 million excluding penalty as the accrued tax and going forward nearly Sh1 billion every year from MPs and the 11 constitutional offices.
A dispute between MPs and the Kenya Revenue Authority over taxation could land in the yet-to-be established Supreme Court.
The taxman sees this as “one of the most viable options” to resolve the standoff, says a confidential document obtained by Saturday Nation.
But before arbitration can begin Parliament, as the employer, will have to raise objections to the KRA’s move within 30 days, says the document, whose contents are some of the yet to be released details discussed in what was said to be a high voltage meeting between the revenue authority’s top brass and the Parliamentary Service Commission on Wednesday.
A source who attended the meeting said Speaker Kenneth Marende and Parliament clerk Patrick Gichohi failed to convince the KRA to reconsider its decision.
“They frantically tried push for continued exemption but the KRA stood its ground,” said the source.
The argument that MPs pay tax on their Sh200,000 basic salary also surfaced but it did not help therir cause as the KRA would not budge.
On Friday KRA spokesman Kennedy Onyonyi confirmed the MPs’ allowances would be taxed. “We are talking of 30 per cent of the allowances,’” Mr Onyonyi said.
Meanwhile, senior counsel Paul Muite said yesterday a report that recommends an increase in MPs’ salaries and allowances has been overtaken by time and can no longer be used to determine their pay.
He said the commission chaired by retired judge Justice Akilano Akiwumi was appointed on the basis of an Act that is now inconsistent with the new Constitution.
The Akiwumi Report recommended the increase in MPs’ pay as well as payment of $1,000 per month to retired MPs, including those who have served for one term.
“If MPs adopt the Akiwumi Report, I expect civil society or anybody else to go to court, and my reading of the Constitution is that the court will rule against MPs,” said Mr Muite.
