Raila Opposes Ruto’s 15% Tax Plan On Digital Content Creators, Asks MPs To Resist Finance Bill

Azimio la Umoja leader, Raila Odinga, on Monday, May 8 raised a number of concerns regarding the proposed Finance Bill 2023, terming it as a weapon formed by Ruto Government against Kenyans.

Speaking to the press, the former Prime Minister argued that some of the proposals were against the promises the Head of State had made during the campaign period leading up to the elections on August 9, 2022.

Of particular focus was the move by the government to impose a withholding tax of 15 per cent for digital content monetisation whereby content creators are contracted by companies to market their products on social media platforms where they attract a huge following.

“From paying zero tax, a creative youth who creates a digital platform or content will now be required to pay 15% tax.

“As a country, we will be killing innovation and leaving our youth with too few options, if any. We will not support this proposal,” he affirmed.

Coinciding with taxing content creators, Raila also rejected the proposal for the government to tax wigs, human hair, false beards, eyebrows and eyelashes at a 5 per cent excise duty, warning that this would not only lock out the youth and women from jobs in that sector, which they dominate but also force beauticians to hike the prices of their wares sold to customers.

“Kenya Kwanza wants to treat beauty as a luxury. Beauty products such as wigs, false beards, eyelashes, human hair, and artificial nails, among others, will see their taxes rise from Ksh0.6 to Ksh2.5 per stamp. This is a 316 per cent hike.

“Like the digital economy, the beauty industry has become a major employer, particularly of our youth and women who have been unable to find work elsewhere. It is a home to hustlers and now Kenya Kwanza is going after their earnings. We disagree,”  he went on.

He also poked holes in the proposal to amend the Employment Act of 2007 to compel employers to contribute to the National Housing Development Fund for each of their employees.

Simply put, employers will now have to pay three per cent of their employees’ monthly basic salary to the Fund, and employees will also be required to contribute three per cent of their monthly basic salary. However, the total contribution from both the employer and employee cannot exceed Ksh5,000 per month, that is, should the Bill sail through in Parliament.

“Unilaterally Kenya Kwanza wants to deduct 3% of basic salaries to finance the affordable housing scheme. In an economy where employees are already faced with reduced income due to the high cost of goods, we find the introduction of this new tax irrational

“We found it curious that while not everyone qualifies for the proposed affordable housing regime, everyone is expected to pay. This is illegal borrowing,” he argued.

What Does Raila Want?

Raila therefore demanded that instead of subjecting all government employees to new mandatory taxation, the regime should instead reduce the size of the government, excess cabinet secretaries, principal secretaries, directorates, advisors, aids, departments and cars are gobbling up finances for no good value for money.

“Why would anyone who doesn’t need a house be compelled to pay 3% of their salary? We need a review of this.

“Taxation of perdiem paid to officers on duty at 30% is punishment. Since when was reimbursement treated as income? This is punitive,” stated the former Prime Minister.

Raila further called for an immediate cessation of non-essential government expenditures including the appointment of Chief Administrative Secretaries (CAS) and for the immediate stoppage of wanton spending of money on political operations that are disguised as relief food distribution or fundraisers.

“It makes no sense at all for Kenya Kwanza operative to spend Ksh20 million on a chopper to distribute Ksh1 million worth of food. It makes no sense for a principal secretary to spend Ksh10 million on a chopper to deliver Ksh200,000 at a fundraiser,”  he added.

The Azimio leader further called for the reduction of domestic and international travel, conferences, workshops, and training, instead proposing for workshops to be held in government offices that he claimed could accommodate training and workshops.

“Parliament has got enough facilities for committees to meet. The same thing applies to members of the county assembly. If they have offices in Nairobi, why would they send the officials to Mombasa to hold the workshops,”  he added.

Raila also called for a freeze on ministerial out-of-station allowances, ministerial house allowances and domestic allowances for cabinet and principal secretaries and ultimately called on Kenya Kwanza to conclusively deal with corruption and embezzlement of public funds.

“Kenyans can’t and won’t tighten their belts any further. They have had enough. Their next available course of action is to force Kenya Kwanza to tighten its belt or force it out,”  lamented Raila.

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