IMF backs cooking oil, loans and higher gambling tax in Kenya

0

Economy

IMF backs cooking oil, loans and higher gambling tax in Kenya


Signage at the headquarters of the International Monetary Fund (IMF) in Washington, DC. PICTURES | AFP

BDgeneric_logo

Summary

  • Some of the tax measures include a 16% tax on cooking gas, increasing excise duty on airtime and data from 15% to 20%, introduction of a 20% duty on fees and commissions levied on loans as well as a 7.5% tax on winnings. Game.
  • The Treasury has allocated a 5.7 billion shillings grant to small farmers for the current main planting season after supplies from Russia were cut off due to sanctions.
  • The Treasury had released 49.164 billion shillings on April 14 as part of the pump price stabilization program which started in April last year to reduce the price of the essential commodity.

The International Monetary Fund (IMF) has backed Kenya’s recent taxation of essential goods and services like cooking gas and bank loan fees, arguing that the extra funds raised have helped cushion the rising cost of fuel and fuel. fertilizer following the war in Ukraine.

The Fund says in the latest review of Kenya’s economy that “significant tax policy measures” resulted in “solid” tax collections in the fiscal year ending in June.

Some of the tax measures include a 16% tax on cooking gas, increasing excise duty on airtime and data from 15% to 20%, introduction of a 20% duty on fees and commissions levied on loans as well as a 7.5% tax on winnings. Game.

“Kenya’s fiscal position has been underpinned by strong tax revenue performance this year, supported by a robust economic recovery and the significant fiscal policy measures already taken under the multi-year plan to reduce debt vulnerabilities” , said Mary, head of the IMF mission in Kenya. Goodman said in a statement following the review between March 31 and April 22.

“These resources provide resilience that will help cushion some of the impact of the sharp increase in global energy and fertilizer prices on households and businesses while remaining within the authorities’ fiscal targets for the fiscal year. 2021/22.”

The Treasury has allocated a 5.7 billion shillings grant to small farmers for the current main planting season after supplies from Russia were cut off due to sanctions, with an additional 1.5 billion shillings budgeted for the period of short rainfall from October to December. .

On the other hand, the Treasury had released 49.164 billion shillings on April 14 as part of the pump price stabilization program which started in April last year to reduce the price of the essential product whose cost has been exacerbated by Russia’s war against Ukraine.

“The fallout from the war in Ukraine is expected to have a modest impact on near-term growth, as Kenya’s direct exposure to Russia and Ukraine is relatively limited,” Ms. Goodman said.

Central Bank of Kenya Governor Patrick Njoroge says the war in Ukraine will not have a significant impact on Kenya, citing the low value of imports from warring Eastern European countries .

Russia, the CBK chief said, accounted for 1.8% (38.64 billion shillings) of Kenya’s nearly 2.15 trillion shillings import bill last year – including wheat ( 17 billion shillings), iron and steel (9.67 billion shillings), fertilizers (6.57 billion) and others (5.41 billion Sh).

He added that Ukraine, on the other hand, only accounted for a measly 0.9% (19.32 billion shillings) of the country’s imports – made up of wheat (14.3 billion shillings), soybeans (1 .93 billion shillings), pulses (966.12 shillings). million) and others (1.93 billion shillings).

The IMF has been pushing for a decade now for reforms aimed at taxing all goods, with vulnerable households to be protected by social protection programs.

[email protected]

Share.

Comments are closed.