Ruto ally takes taxation war to handshake men

Written by on 7 February 2023

The government yesterday appeared to take its tax war on the doorsteps of the architects of the March 2018 Handshake between then President Uhuru Kenyatta and opposition leader Raila Odinga.

Leader of Majority in the National Assembly Kimani Ichung’wah told the media yesterday he had written to the Treasury Cabinet Secretary Njuguna Ndung’u requesting for a list of firms and individuals who benefited from tax exemptions during the period starting January 2018, two months before the handshake.

“This is to request information on tax reliefs, exemptions or waivers granted by your ministry to an individual, company, firm or institution (other than religious or faith-based organisations or institutions, educational institutions or charitable organisations) from January 1, 2018, to date,” read part of Ichung’wah letter to the CS.

“Additionally, kindly provide information relating to tax incentives granted to firms or companies under contractual agreements entered into by the government for the implementation of various capital projects during the above period.”

In the letter dated February 6, Ichung’wah wants the CS to furnish Parliament with a statutory basis for the waivers, a list of individuals, companies, firms or institutions granted tax relief, exemptions or waivers.

The January 1, 2018 date is believed to be calculated towards netting the players who mooted the handshake deal which ended hostilities between the then Jubilee government and the now defunct National Super Alliance (Nasa) leadership.

But as the government moved to crack down on perceived tax evaders during the handshake era, Raila accused the Kenya Kwanza administration of acting out of ignorance and receiving bad advice on the tax evasion saga.

“The Kenya Kwanza administration is pushing for the removal of a non-existent exemption of only former Presidents Jomo Kenyatta and Daniel arap Moi from payment of Estate Duty Tax if this was not a clear and worrying indication that the country’s top leadership is receiving or seeking bad advice,” Raila said in a statement.

Bad staff

He added: “The highest level of government appears to be relying on bad advice from incompetent or malicious staff with extremely poor judgment. But it is also safe to conclude that this expression of ignorance at such a high level on such a serious matter is a reflection of the people who hired the bad staff or who have chosen the wrong company to canvas very important and delicate policy matters.”

“Indeed there is no law that requires the estates of the late Presidents Kenyatta and Moi to have been paying this tax. No Kenyan, not just Kenyatta and Moi families, are required to pay taxes on property inherited from the deceased. The law that existed on this matter was repealed for all Kenyans way back in 1982,” stated the ODM leader.

The Estate Duty Act, which was assented to on August 7, 1963, and backdated commencement date of June 12, 1963, imposed a tax on the estates of deceased persons. Section 7 of this law set out the property that was subject to estate duty tax and included all property of which the deceased was at the time of his death, competent to dispose of; all property which immediately before the death was held for the use or enjoyment of two or more persons of whom the deceased was one; and the proceeds of any policy of assurance on the life of the deceased.

Raila explained that in 1969, the Act was amended to exempt Mzee Jomo Kenyatta’s property from being subject to estate duty. In 1981, a further amendment was effected to exempt President Moi from payment of the tax.

End game

But according to Ichung’wa, tax exemptions, reliefs and incentives were exploited by those in power during the previous government.

“These individuals must be named and shamed to serve as a warning to those holding offices. They abused the tax exemption favour blatantly and must be made to pay,” Ichung’wa told a press conference at his offices.

“Everybody is obligated to pay taxes and no state officer has the power to waive taxes for the families,” he stated.

“The end game is to ensure that taxes are paid by all Kenyans so that we end impunity,” he said.

Ichung’wa, who is the MP for Kikuyu, is also seeking information on the circumstances or grounds upon which such exemptions or waivers were granted.

“We shall appreciate having the information within fourteen days from the date of this request,” reads the letter.

Asked whether the demands were driven by vendetta and malice against retired President Uhuru Kenyatta and his family, Ichung’wa said it is the role of Parliament to oversight the government.

“Why would there be a personal war with Uhuru Kenyatta? We are only doing our constitutional mandate,” said the MP.

Uhuru has since dismissed his accusers as idlers who have nothing to do and who were using the tax issue to cover up for their failures.

Former First Lady Mama Ngina Kenyatta also waded into the tax debate denying tax evasion claims and daring her accusers to seize her assets to reclaim the alleged unpaid taxes.

Ichung’wa said there has been widespread tax evasion in the country involving those in positions of leadership saying the time had come for them to be named.

He dismissed claims by the opposition that Ruto’s administration had increased taxes, making life unbearable for many Kenyans.  “Those who enacted the Financial Bill of 2022 that resulted in the high taxes are now blaming the current administration for what they did. Taxes being levied on Kenyans were things done in the last Parliament under the previous government,” he said.

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