Raila: Over-taxation won't yield desired results
ODM party leader Raila Odinga.
Azimio la Umoja-One Kenya Coalition leader Raila Odinga on Thursday called for a lifestyle audit of procurement and "big boys" as a remedy to runaway taxation in the country and to tame theft in government.
According to Odinga, the high taxation being imposed on Kenyans by the Kenya Kwanza government is hurting the economy and citizens and not really solving the problem at hand.
The opposition leader noted that the Kenya Kwanza government was walking in the ghost of past regimes, repeating the mistakes of the Kanu era.
“We have been here before. When we came into government for the first time in 2002, we found a collapsing economy…then we critically examined the economic status and realised where the problem was,” Mr Odinga said.
He explained that President Mwai Kibaki had turned the economy around through deliberate and calculated measures, eventually unlocking the country's dormant economic potential. The Kibaki regime, he said, took drastic measures to seal the vices that were ailing the economy.
“We looked at the revenue side and the expenditure side. Where the money is coming from and how the money is being spent. Then we realised where the problem was: the revenue boys; income tax, VAT, and customs officers in the ministries. Those are the boys who are buying apartments,” he said.
Mr Odinga explained that the desired results lie in closing the loopholes of corruption and curbing all revenue leakages. This, he said, will lead to an increase in revenue collection.
“So, if you do a lifestyle audit, you will curtail the [stealing] and without increasing taxes [bring the economy off its knees],” he suggested, adding that “increasing taxes is not the solution to the problem we are having. If you increase the taxes, there’s always a tendency to evade taxes.”
Mr Odinga cited the drop in fuel consumption as evidence of a financially distressed population due to "over-taxation". In the long run, he explained, the government loses out.
The former prime minister was speaking in Nairobi when he met students from various higher education institutions.
Mr Odinga also criticised the new university funding model. The funding model includes bursaries, loans and household contributions on a graduated scale determined by a 'testing instrument'. But the opposition leader discredited the model, saying: "Where is the yardstick for measuring neediness?"
