from: Ouko joachim omolo
The News Dispatch with Omolo Beste
SATURDAY, NOVEMBER 9, 2013
The Vice Chancellor of the Catholic University of Eastern Africa (CUEA) Rev Dr Pius Rutechura has made an appeal that President Uhuru Kenyatta should heed to. Rutechura has requested Uhuru to waive the Tax on ICT equipment and materials for learning institutions so as to enable the institutions run this course at lower cost and makes it more accessible.
CUEA is not only among the institutions of higher learning that value the importance of ICT but has also launched the first IBM commercial technology research facility in Africa at CUEA on November 8, 2013.
Fr Rutechura is not the first to make the appeal. Education Cabinet secretary Jacob Kaimenyi had made similar appeal to President Kenyatta to issue a directive including a tax waiver to kick-start supply of 1.3 million Class One laptops.
Prof Kaimenyi argued that it was possible for the ministry to supply about 600,000 laptops in the first term with the balance supplied by the beginning of second term next year if taxes were waived.
The laptop project is a key part of the Jubilee manifesto and is supposed to be implemented by ministries including ICT, Education and Energy which will supply power to primary schools. This cannot kick off due to heavy taxes on ICT. It means that children will not get access to laptop next year.
Government terminated the tender after the lowest bidder quoted Sh32 billion against a budget of Sh12 billion. Had taxes been waived the Government would be in position of purchasing the laptops. Click here to read: Ministry throws out all bids for supply of laptops. http://www.businessdailyafrica.com/Ministry-throws-out-all-bids-for-supply-of-laptops/-/539546/2037364/-/fmowr2/-/index.html
Prof Kaimenyi said that a tax waiver would help bring down the cost of the laptops, thereby making the computers available to pupils by the first quarter of next year.
Even when Uhuru Keyatta was the Finance Minister the same issue was raised, especially with mobile communication popularity which was on the rise at the time he was the minister.
All eyes were on Kenyatta to see if he would reduce or waive taxes on airtime and mobile phones. The aim was to enable middle class Kenyans to easily get access to mobile phones.
Stakeholders had told Kenyatta that high cost of communication prohibited growth in the telecommunications sector, especially in rural areas where majority of middle class people use mobile phones for easier communications.
That time mobile phone companies were paying 10 per cent excise duty and 16 per cent VAT on air time. Kenyatta did not consider this in his 2009/2010 budget and up to now mobile phone communications have become the most expensive commodities to use in Kenya.
Since then the custom duty on mobile phones and accessories has also seen prices of handsets remain high and out of reach for some Kenyans, especially in rural areas.
If taxes were to be waived ordinary Kenyans would find mobile phones affordable and this would empower them in carrying out their activities, including small scale business that use internet to search for cheaper commodities.
For many people in Kenya, including students, their first Internet experience will be with a mobile device as laptops and PCs are too costly or impractical. Most students use internet for their research works.
Currently the Internet penetration in Kenya is about 33.6 per cent. It explains why the high cost of mobile phones is also partly to blame for the increased shipping of counterfeits cell phones to the country.
Kenyatta could not waive taxes because the high budget the government was using to run its affairs. For example the total cost of the President Kibaki’s household and the press service was Ksh888.5 million.
The cost of maintaining the official residences of President Kibaki (6 State Lodges and State House Nairobi) was Ksh823 million. The President’s Press Unit (comprising 37 staff) was Ksh65 million. The President had 388 staff employed in all the State residences and the use of 149 cars.
The total cost of the Vice-President Kalonso Musyioka’s household and the press service was Ksh230.7 million. The Vice-President’s household and press unit was costing the Kenyan taxpayer Ksh185.3 million.
The amount provided did not include the VP’s house allowance of Ksh2.4 million (Ksh200,000 per month). The Vice President’s household has an annual budget of Ksh4.3 million for hospitality – about Ksh358 000 per month.
Over Ksh30 million was budgeted for rent under the VP’s Household budget line. The household could consume Ksh14 million per year on fuel and stay within budget, while also spending Ksh11 million on routine maintenance of vehicles, and a further Ksh6.5 million on maintenance of other assets in the households.
Over Ksh75 million had been allocated to the VP’s household for domestic and foreign travel. The Vice President’s official household comprised of 57 staff and there were 12 cars.
The total cost of the Prime Minister’s household and the press service is Ksh110.6 million. The Prime Minister’s household and catering budget Ksh36.9 million annually. This included Ksh5 million for utilities-water and electricity, Ksh1.2 million for advertising, Ksh26.5 million for hospitality and Ksh2.2 million for purchase of household furniture.
Additionally, the Prime Minister had a house allowance of 4.8 million in one financial year (about Ksh400,000 per month). The Prime Minister also had a dedicated press unit whose budget was Ksh68.9 million per annum.
This explains partly why the Jubilee government is walking a tight rope of balancing between delivering its ambitious election pledges and prioritizing economic demands for national development, as stipulated in the Constitution.
Uhuru’s plan to abolishing maternity charges at all public hospitals and access fees at dispensaries and health centers cannot work effectively because the government has no enough money.
It explains further why Uhuru’s immediate option is to re-introduce the Value Added Tax (VAT) Bill. VAT is expected to bring immediate short-term revenue of Ksh11 billion to make government affairs run effectively.
Fr Joachim Omolo Ouko, AJ
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Real change must come from ordinary people who refuse to be taken hostage by the weapons of politicians in the face of inequality, racism and oppression, but march together towards a clear and unambiguous goal.
-Anne Montgomery, RSCJ