NATIONALNEWS

Farmers score big as Rotich raids women

Tea and sugar cane farmers, low income employees and fresh graduates are the winners while motorists, importers of cosmetic and beauty products are the losers in the tax measures that Treasury Cabinet secretary  Henry Rotich announced yesterday.

In his budget statement, he abolished two key levies that reduce farmer’s income. For the tea farmers, he struck out the ad valorem levy while for sugar cane farmers, he abolished sugar cane development levy. “In order to improve the earnings of the farmers, I propose to remove these levies.

The institutions that were hitherto funded from these levies will now be funded from the exchequer,” Rotich told Parliament adding that all other levies including levies charged by National Environmental Management Authority (Nema) and National Construction Authority (NCA) are on the chopping board  to reduce the cost of doing business.

For low income workers, Rotich exempted them from tax bonuses, overtime and retirement benefit payments.

“I propose to expand the tax bands and increase personal relief by 10 per cent. These measures are meant to cushion workers from high cost of living and demonstrate our commitments to sharing the growth of our economy,” he said.

Rotich also opened a window of opportunity for young graduates to be absorbed in the job market with an incentive to employers. He said he will gazette the regulations to guide the incentive where employers will have 50 per cent tax allowance on the graduates’ payments as long as they have 10 graduates as apprentices.

Other big winners were property developers, whose corporate tax came down from 30 per cent to 20 per cent as long as they deliver 1,000 home units in a year. Apparel and leather companies operating in the export processing zones also scored big with  Rotich exempting their clothes and shoes from Value Added Tax (VAT).  Raw materials used in the manufacture of animal feeds will also be VAT exempt.

But motorists will have to dig deeper into their pockets to be on the road after the CS raised the road maintenance levy from Sh12-18 per litre. Importers of iron and steel also took a hit with Rotich blaming them for closure of local iron and steel mills.

“In order to protect and create more jobs for our youth in the iron and steel sector, I have introduced a specific duty rate of US$200 per metric tonne on a wide range of iron and steel products which are available in the region to cushion our local manufacturers from unfair competition,” he said.

Rotich also reinstated duty on Kerosene in a move he said was aimed at curbing fuel adulteration. Importers of kerosene will now have to pay, Sh7,025 per every 1000 litres. Liquid petroleum gas will be VAT exempt while Cosmetics and beauty products will attract 10 percent excise duty.

Show More

Related Articles

Close