Kenya Delays Tax Relief Plan as Treasury Fears Revenue Loss
**KENYAs Plan to give Low-Income Earners a Break On Tax Has Hit a Roadblock ,with the Government Now Freaking Out About Losing Big Time On Revenue.
National Treasury says its still deciding whether to go ahead with Proposed Tax Relief for workers earning up to Sh30,000 a month – despite this still being the plan. According to National Treasury Cabinet Secretary John Mbadi, officials are still working out the numbers before they can even think about putting it in the upcoming Finance Bill. And that comes at a really bad time too – many Kenyans are really struggling to make ends meet because of the cost of living, so were hoping some tax relief would give them a bit of breathing space.
Treasury Warns of Sh35 Billion Revenue Loss
Mbadi is getting a bit worried that if they go ahead with the changes now, they could lose out on Sh35 billion in revenue.
Theyre now trying to figure out whether they can make up for that lost cash either by getting better at collecting taxes or by cutting back on government spending – so that they can still go ahead with the tax relief.
All this delay is likely to really upset thousands of workers who were counting on lower tax deductions from their paychecks.
What the Proposed Tax Changes Would Mean
The proposal was first floated by President William Ruto as a way to help lower-income earners out.
Under the plan:
- Workers up to Sh30,000 would basically be exempt from PAYE tax , nice.\
- workers between Sh30,000 and Sh50,000 would see their tax rate come down to 25% from 30% – so theyd pay less tax
If its all signed off, then it should help formal sector workers by reducing how much tax they pay each month.
Pressure Mounts Over Cost of Living
The Government is getting a lot of pressure to do something about the cost of living , because prices for Basics like food, transport and housing are still really high. Many Kenyans have been yelling at the government to cut taxes and give them a bit of extra cash for now – theyve got a good point too – their disposable income has been shrinking even tho they promised some sort of relief.
and its all just getting harder for Treasury Officials to balance getting some tax relief out to people with keeping the government making enough cash to pay for things like hospitals and roads.
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Kenya Delays Tax Relief Plan as Treasury Fears Revenue Loss
