16 Aug

Petition to Parliament -VAT ACT NO.35 Signed

RE: PETITION TO THE NATIONAL ASSEMBLY CONCERNING THE PROPOSED VAT ACT NO.35 OF 2013 (REV 2017) AMENDEMENT BILL 2018

We, the undersigned,

Citizens of the Republic of Kenya residing in Nairobi County, and being the official party leaders of Thirdway Alliance Kenya, a party duly registered under our laws, and further pursuant to the relevant provisions of our Constitution and laws, and in particular, Article 119 and Sections 3 & 4 of the Petition to Parliament (Procedure) Act No. 22 of 2012, respectively

DRAVV the attention of the National Assembly to the following concerns:

  1. Rise in general price level
    1. That Petroleum, being a major source of energy in Kenya, must not be subjected to VAT as this will result to an increase in the general price levels in the economy.
    2. That Kenya is currently dogged with high unemployment levels, which is estimated at over 50%; and majority of our Kenyan people are still living below the poverty line and any attempt to levy additional taxes on petroleum products will result into high consumer prices.
    3. That the eventual consequences of high consumer prices will further make the lives of millions of Kenyans unbearable and more miserable.
  2. High cost of doing business
    1. That the proposed levying of VAT under section B of the VAT Act 2013 (Rev 2017) will result into high cost of doing business in Kenya.
    2. That the other consequence of that would be to make Kenya an unattractive investment destination for both local and foreign investors.
    3. That the current government is proposing under its Big 4 agenda to industrialize Kenya BUT this will just be a pipe dream when the cost of doing business is high.
    4. That with hurdles on industrialization and to investors, no jobs would be created for millions of Kenyans who are currently unemployed.
  3. Discourages local savings and investments
    1. That we also contend that although over-taxation may be good for government revenue growth, it is counter-productive because it will impact negatively on local savings and investments.
  4. Current Kenyan oil prices are among the highest in the world
    1. That we also draw Parliament's attention fo the fact that Kenya's petroleum product prices are among the highest in the world.
    2. That in fact, the prices of the products in the United States, where majority of citizens have higher disposable incomes than Kenyans, are below I US Dollar (KES 100).
    3. That we are therefore unable to comprehend how a poorer population will be able to foot the exorbitant prices and that enforcement of the VAT Act 2013 as is currently enacted will make the situation even direr.
  5. Discourages tourism and increases cost of horticultural exports
    1. That levying of VAT on Jet spirit will force local airlines to increase their fares and freight charges and obviously impacting negatively on both local and international tourism hence lowering the competitiveness Of our horticultural exports.
  6. Prudent Financial Management and taming theft of public money
    1. That the government must resort to prudent financial management, stop theft of public money and also recover stolen public money to fill in any gaps in the current budget.
    2. That over taxation must not be the only fall back whenever the government is unable to meet budgeted revenue targets.
    3. That the National Treasury must investigate all budget lines with an aim of reducing expenditure estimates without stalling the envisaged results.
    4. That there is credible evidence that this is possible as we have seen billions of Kenya shillings being stolen from institution} that do not collapse thereafter, like the NYS, meaning many government departments are still operating on excess budgets.
    5. That we also call for the National Parliament to be more vigilant on audited accounts of preceding fiscal years.
    6. That failure by parliament to debate most recent audited reports, and to pass division of revenue laws in accordance with he Constitution, has also resulted in loss and theft of public money through over-budgeting and outright failure to account. For example, the Division of Revenue Law (no. 7 of 2018) that was premised on the wrong audited accounts of FY 2013/14, which was a total collection of KES 937 billion, robbed Keny┼Ż)1Äs of unaccounted billions of Kenya shillings had parliament debated the most r#cent audited accounts in order that revenue may be divided on that most recent audited account.
    7. That the foregoing offended the provisions Of the Constitution of Kenya 2010, which requires that division of revenue be based on the most recent audited accounts.
    8. That the most recent audited accounts are these of FY 2016/17, whose collection was KES 1.4 Trillion.
    9. That Kenyans therefore lost a staggering KES 500 billion in this FY 2018/19.
    10. That this is money that could alleviate the cost of living for Kenyans and with this money available, we would not need to over Oax Kenyans as is currently proposed in the VAT Act 2013.
  7. Reduced Purchasing power
    1. That the rise in petroleum products will deonitely reduce the purchasing power of ordinary Kenyans.
    2. That this will suppress effective demand Ond consequently reduce aggregate demand.
    3. That the impact of this need not be over emphasized as it would negatively lower the sales volumes of locally manufactured go cls.
  8. That the admission of this petition will not affect nor will it limit any fundamental rights.
  9. That the amendment to the VAT Act shall Oot occasion additional expenditure of public funds.
  10. That the matter therein has not been add essed to any other public body as amendments of Acts of Parliament is the bus ness of parliament only.
  11. That the issues raised herein are not peinding before any court of law, a constitutional or legal body.

 

Wherefore your humble petitioners pray that the National Assembly-

l . Amends the First Schedule of the VAT Act No. 35 of 2013 (Rev 2017) by deleting Section B: EXEMPT GOODS IN

2. Amends the First Schedule of the VAT Act No. 35 of 2013 (Rev 2017) by insertina item No. 94 immediately after ite No. 93 incorporating the following items frcm section B with tariff Numbers as follows:

2709.00.00 Petroleum oils and oils obtained from bituminous minerals, crude

2710.1220 Motor Spirit (Gasoline) Regula

2710.1230 Motor Spirit (Gasoline) Premium

2710.12.40 Aviation Spirit

2710.12.50 Spirit type jet fuel

2710.12.90 Special Boiling point spirit and white spirit

2710.19.10 Other Light oils and preparatio ns

2710.19.21 Partly refined (including toppe crudes)

2710.19.22 Kerosene type jet fuel

2710.19.29 Other medium petroleum oils nd preparations

2710.19.31 Gas oil (Automotive, light, am er, for high speed engines)

2710.19.39 Other gas oils

2711.21.oo Natural gas in gaseous state

2711.20.0Q Other Natural Gas in gaseous s ate

For and on Behalf of Thirdway Alliance Kenya, Dated this 16th Day of Aågust 2018

No.

Name

Address

ID No.

S • nature

l .

Dr. Ekuru Aukot

P.O box 4781 -001 0

11427415


2.

CPA Miruru Waweru 

P.O box 4781 -001 0

10895129