Source: Twitter
John Mbadi, who has been nominated to be the Cabinet Secretary for the National Treasury, reassured Kenyans that the economy would not be negatively impacted if the Finance Bill 2024 is withdrawn.
Speaking before the National Assembly's Committee on Appointments on August 3, 2024, Mbadi clarified that finance bills are not the only tool for managing the country’s economy.
Mbadi explained that finance bills serve primarily to amend existing finance laws. These laws include those governing Excise Duty, Import Duty, Value Added Tax, Income Tax, and other fees and levies.
He stressed that these amendments can be integrated into current laws, making it unnecessary to pass a new Finance Bill every year.
"We don’t have a gap. The Finance Bill usually amends several existing laws. If I’m approved, I will work with the House to bring these changes directly to the specific statutes," Mbadi said.
Many Kenyans have been worried about the potential economic fallout from withdrawing the Finance Bill 2024.
Mbadi aimed to alleviate these concerns by explaining that the financial system has mechanisms to function without a new Finance Bill.
He pointed out that during the 10th and 11th parliaments, the Finance Bill was often passed in September, which is three months into the financial year.
This delay did not disrupt the functioning of the economy, demonstrating that there is some flexibility in the timing of such legislative measures.
One of Mbadi’s key goals, if approved as the Cabinet Secretary for the National Treasury, is to simplify the tax system.
He believes that a simpler tax regime will encourage more Kenyans to comply with tax requirements, thus broadening the tax base. This approach aims to increase government revenue without imposing new taxes or levies.
"We need to simplify our tax laws to make it easier for more people to understand and comply. This will help us increase our revenues without introducing new burdens on the taxpayers," he explained.
Mbadi emphasized that there would be no vacuum in the financial system even if the Finance Bill 2024 is withdrawn. He mentioned that the important provisions of the Finance Bill could still be enacted through other legislative processes.
These provisions can be introduced at different stages of the budget-making process or attached to existing laws through amendments in parliament.
This approach ensures that necessary financial regulations and amendments are still implemented, maintaining the stability and continuity of the economic system.
John Mbadi is set to take over from Njuguna Ndung'u, who served as the head of the Exchequer for over 20 months before being dismissed in July 2024.
Mbadi’s nomination is part of President William Ruto's strategy to include members from the opposition party, ODM, in his cabinet.
This inclusive approach aims to foster unity and collaboration across political lines for the betterment of the country.
Besides John Mbadi, other prominent ODM officials have been nominated to key cabinet positions.
Hassan Joho has been nominated to head the Ministry of Mining and Blue Economy, Wycliffe Oparanya is set to lead the Ministry of Co-operatives and MSME Development, Opiyo Wandayi has been proposed for the Ministry of Energy and Petroleum, and Beatrice Moe is nominated for the Ministry of East African Community (EAC).
This diverse inclusion aims to bring various perspectives and expertise into the government, enhancing its overall effectiveness.
Mbadi's reassurance is a critical step in addressing the fears and uncertainties among Kenyans regarding the potential economic impact of withdrawing the Finance Bill 2024.
Looking ahead, Mbadi plans to work closely with the National Assembly to ensure that necessary financial regulations are passed and implemented efficiently.
His focus will be on creating a more inclusive and simplified tax system, which will not only increase revenue but also ensure fairness and transparency in the taxation process.
He is committed to ensuring that the country's financial system remains robust and capable of supporting economic growth and development.
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