9 Ways the Finance Bill 2023 will lower cost of living: Kimani Ichung’wah

National Assembly Majority leader Kimani Ichung’wah has responded to some pressing questions about the contentious Finance Bill, 2023, revealing how it will lower the cost of living.

In a detailed statement on Monday, May 15, the Kikuyu MP sought to demystify the proposed laws relating to various taxes and duties.

“The Finance Bill, 2023 has several specific proposals which seek to lower the cost of living for all Kenyans,” said Ichung’wah.

Ichung’wah went on to list 9 proposals that he says will cushion Kenyans against the current tough economic times.

These include Affordable Housing, Lower prices of Unga, Lower costs of fertilizers, Lower cooking gas prices, Reduced Rent, Cost of medical care, Cost of Basic commodities, Unnecessary tax penalties, and Ease of Tax Obligations and Refunds.

On Affordable Housing, Ichung’wah says: “This Fund shall be used to provide affordable houses for the many non-housed Kenyans. The Bill provides that an employer shall pay to the National Housing Development Fund established under section 7 of the Housing Act, in respect of each employee the employer’s contribution at three (3°/o) per centum of the employee’s monthly basic salary; and the employee’s contribution at three (3°/o) per centum of the employee’s monthly basic salary.

“There is a proviso that the sum of the employer and employee contributions shall not exceed five thousand shillings a month,” Ichungwah added.

The National Assembly Majority leader also clarified that the affordable housing levy is not a tax.

“The levy is a savings plan deduction with benefits accruing to the employee. It will also enhance the national saving plan,” said Ichung’wah.

On the Cost of Medical Care, Kimani says:

“The Bill proposes exemptions under the VAT Act of various medical products and taxable goods for the direct and exclusive use in the construction and equipping of specialized hospitals.

“The Bill once enacted shall lower the cost of medical care by Kenyans, shall promote the development of the health infrastructure and ensure access to affordable health care by all Kenyans.”

On Cooking Gas, the Finance Bill 2023 proposes to exempt LPG from VAT.

“This shall lower the costs of LPG and hence ensure that many households including Kenyans in informal settlements have access to clean energy for cooking,” said the MP.

On Rent Prices coming down, Kimani Ichung’wah says the Bill proposes the reduction of applicable income tax rate on monthly rental Income from ten percent (10°/o) to seven-point five percent (7.5%).

“The reduction shall have a trickle-down effect on the cost of rent payable by tenants as the Bill has reduced the tax payable by landlords for monthly rental income.” He explained.

Find the full statement below.

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