Employers Demand PAYE Lowered 25% and Fuel VAT reverted to 8% as a cushion on employees.
The Federation of Kenya Employers Demand PAYE Lowered 25% as a cushion to Kenyans and businesses that are struggling to keep up with the high cost of living.
President Dr. Habil Olaka and Executive Director Jacqueline Mugo on Friday,” We appeal to policymakers to consider reducing the PAYE to a maximum of 25%. This is because food inflation remains the highest contributor to the cost of living. With households spending about 60% of their income on food, it is prudent that households are supported to increase their disposable income,”
“You cannot improve on the savings culture of your citizens and increase capital for investment if the people do not have adequate disposable income that enables them to cover their basic needs,” they added.
They further called upon preaident Ruto to revert Value Added Tax (VAT) on petrol to its previous 8 per cent rate as it stood before the enactment the Finance Act 2023.
They stated,”This will help in attracting investment and allowing the corporates to have money to plough back into their business to create more employment. The additional investment will result into more tax revenue,”
“In addition, we seek the removal of the minimum turnover tax. This tax is going to exacerbate informality and destroy microbusinesses that employ 84% of wage employees in Kenya,” they added.
Notably, They urged the gov’t to charge the affordable housing at Ksh.5,000 per month as a way of supporting businesses and combat financial burdens on employees.
They stated,”We lastly urge that the Affordable Housing Levy be capped at Ksh.5,000 per month as it was originally proposed. Businesses are closing down, and we are seeing employees increasingly becoming working poor,”
“We are currently in a situation where businesses are not able to meet their operational costs and at the same time employees are not able to make ends meet. Further, electricity cost being an input cost, Kenya’s goods and services prices remain comparatively higher in the region pushing up the cost of living,” they added.
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