The finance bill 2023 seeks to amend various laws relating to taxes and duties with the goal of increasing government revenues from taxes collected. This has created a hotly contested debate between the government, members of parliament, and the union of workers.
The President of Kenya, William Ruto speaking in Narok on Sunday 4th June 2023 said he will be keen to see MPs who will vote against the finance bill.
His deputy, Rigathi Gachagua said that no more roads to areas where MPs vote against the finance bill.
While the fight continues, many Kenyans who have not read the finance bill are asking what it entails. You don’t have to read the 160-page document to know what it entails. Here is the summary of the finance bill 2023 that if passed by the parliament, salaried Kenyans will be taxed more.
Read the finance bill here.
Proposed Taxes in Finance Bill 2023 Kenya
- 3 percent Housing levy
The finance bill 2023 proposes to start building affordable houses for Kenyans and therefore it demands that Kenyans should contribute three percent of their basic salary to the Housing Fund. This seeks to increase the number of Kenyans owning houses and also create jobs for the Kenyans.
This is the major part of the finance bill that has met severe resistance from Kenyans, with many asking, “Nani Hana kwao?” All eyes of Kenyans are now on MPs to see if they will vote against this housing allowance.
- 35% PAYE on those earning above Ksh 500,000
Those earning above Ksh 500, 000 will be taxed 35% of their taxable income when the finance bill will be passed by the parliament and signed into law by the parliament.
- 8% VAT on Fuel
This will see prices of commodities go up since fuel is a key factor in any economy.
- Excise duty on Imported Fish
Every tonne of imported fish will be taxed Ksh 100, 000. This is to protect the local fishing sub-sector.
- 20% Excise duty on imported powdered juice
This is to protect locally produced juices.
- 10% percent on imported cement
To protect local cement manufacturers.
- 30% excise duty on imported furniture
- 20% excise duty on gambling, lottery and lottery.
This will be increased from 7.5 to 20%
- 5% excise duty on human hair, eyelashes, and fake nails
- 16% VAT on insurance compensation
Once the finance bill is signed into law, the insurance compensations for Kenyans will be taxed 16%.
- 20% EXERCISE DUTY ON MOBILE AND INTERNET DATA
- 12 % ON MOBILE MONEY TRANSFER
Below are the taxes that have been reduced or removed.
- 8% VAT on LPG
The 8% VAT on LPG has been removed.
- Among others
Effect of Finance Bill on the Kenyan Economy
The finance bill will adversely affect Kenyans, it will reduce disposable income for the salaried Kenyans. Although housing allowance will create jobs for a small number of Kenyans, those jobs will not be continuous. Time will tell.
How Should Christians Respond to Finance Bill
Christians have the right to express their concerns to the government but their concerns may be heard or ignored. In everything we do, we should seek to please God in all things. The Bible admonishes us to live peacefully and pray for our government.
We have a higher authority to which we should submit. Even governments should submit to King Jesus. Our concerns may not be heard by earthly governments but we can be sure that King Jesus hears them all.
As Christians, we cannot live with don’t care attitude about our governments. We have a duty to undertake. We should offer advice, call out, and pray for our leaders.