In the wake of the move by the Kenyan government to impose the 16 per cent levy on petroleum products, the Kenya National Chamber of Commerce ( KNCCI )has made key recommendations to the civic body on how to manage its debt.
The move to have VAT on petroleum products was mandated by the International Monetary Fund (IMF) as a method for Kenya to better deal with its public debt. The condition that was set by the IMF is part of an agreement for a standby credit facility that would allow emergency borrowing in the event of economic shocks. The change of policy is expected to increase tax revenue, contain the level of debt and improve the balance of payments of Kenya.
Here are some of the recommendations that KNCCI have made to the government:
- Expand the Tax Base by adopting a presumptive tax and increasing taxes on goods with negative externalities
- Curb Losses to Corruption by handling the problem of impunity
- Improve Public Transport Network and Service Delivery through the development of a public transport network with efficient service delivery to encourage more people to use public transport and leave their cars at home
- Support Local Industries to Enhance Competitiveness by empowering the Ministry of Trade and Industry to better support the sector
- Conduct an Audit of Government Spending by heeding the directives of the Auditor General and make changes to spending based on independent reviews of government spending.
“The chamber will continue to support the government where need be to come up with remedies to various national issues affecting business climate and we look forward to engaging the relevant government agencies on the same.” KNCCI’s National Chairman Mr Kiprono Kittony said in a statement.