In proposed changes in the Finance Bill 2020, Mr Yatani is seeking the green light from Parliament to compel firms which have not been taxed elsewhere to pay one percent of gross sales to the Kenya Revenue Authority (KRA).

The Bill contains new measures which will help generate new revenue to partly fund the Sh3.2 trillion budget.

The proposed levy to be known as minimum tax will take effect January 2021 and is largely targeted at companies which do not pay corporate income tax, which is based on profit.

Treasury secretary Ukur Yatani wants monthly or lump sum pension paid to senior citizens subjected to applicable income taxes through the proposed changes in the Finance Bill 2020.

Mr Yatani has reintroduced the proposal in the Bill after it was voted out by lawmakers in the Tax Amendment Act which was passed in April to cushion businesses and workers from Covid-19 shocks.

It appears that the bigger concern for the government is how to increase its revenues to reduce the mismatch with its expenditures. The sharp decline in government revenues as a result of the negative impact of the pandemic on economic activity and tax cuts, particularly on individual taxpayers means that we should expect a wider fiscal deficit for as long as the current economic conditions persist.

In Kenya, the potential spread of the disease is likely to affect the well being of citizens, and an increase in the number of poor and vulnerable households is imminent.  This calls for a swift and coordinated policy approach by the Government in responding to the crisis to cushion Kenyans from the adverse effects of the pandemic. For the Government to respond appropriately, quality data on the effects of the pandemic is urgently needed.

The exchange rate remained stable due to the narrowing current account deficit, from 5.0% of GDP in 2018 to 4.9% in 2019 thanks to increased transfers. Foreign exchange reserves rose from $9 billion in 2018 to $9.4 billion at the end of August 2019, equivalent to 6 months of imports, or more than the East African Community convergence criterion of 4.5 months. The fiscal deficit is estimated at 7.5% of GDP in 2019, down from 8.8% in 2017, thanks to ongoing fiscal consolidation and greater domestic resources mobilization.

The Kenyan economy has been mostly unfree for more than two decades. GDP growth over the past five years, however, has been robust, led by expanded consumer demand.

Absa Bank Kenya has announced that it has restructured over 50,000 loan facilities amounting to over Ksh 54 billion.

In a statement, the bank says loan relief programme covers all types of credit types including personal loans, mortgages, asset financing and business loans among others. Under this programme, customers qualify for an initial relief of up to three (3) months which can be further reviewed on a case by case basis. READ MORE..

The ‘Big 4’ Agenda projects have been allocated KSh 128.3 Billion in the 2020/21 National Budget. A massive drop from KSh450.9 Billion allocated in last year’s budget and KSh 400 Billion allocated in the 2018/19 budget. READ MORE..

The Treasury Cabinet Secretary Ukur Yatani walked a tight rope while making public pronouncements on the Kenya Budget including his revenue-raising measures and the highlights of the KSh 3.2 Trillion 2020/21 document, his first such appearance before parliament. READ MORE..

National Treasury CS Ukur Yattani reads his first budget statement today, Thursday 11, giving the outlook for the FY2020/21. He will be presenting a Ksh2.7 trillion budget whose Ksh1.8 trillion expenditures far outweigh the projected meager revenues of Ksh1.6 trillion. READ MORE..