There has been a lot of debate concerning taxes in recent times fuelled by revelations that the elite in Kenya who have been in national leadership for years have been playing the system by exempting themselves from paying certain taxes. Taxes have been in existence since the existence of man including during the biblical Zakayo the tax collector’s time. But why are they so controversial?
Taxes are meant for the development of everyone in a society, to organize that society to meet certain goals and services for the benefit of all. Taxes ensure that a governing structure meets its costs as well as providing service to citizens. Governments of whatever nature do not make money to operate. They rely on citizens conducting productive work that can result in trade that brings income. It is this income that the government targets to tax to get a piece of the cake. Some lucky governments sit on natural wealth like oil and minerals. They invite private businesses to exploit these resources at a fee so that they can be turned into sell able goods to bring income which in turn provides tax revenue for government. In essence, government largely relies on private business to create wealth that can be taxed to bring in revenues. The government does nothing other than wait for you and me to produce and be taxed. In return we expect the government to use this tax to create a conducive environment for us to live well, produce and trade much more easily. We therefore expect infrastructure, security, education, health and any other services that make our lives better.
The controversy arises where accountability begins. The government is run by people selected, elected, or chosen to oversee its running. As we cannot have everyone run government, the chosen few are therefore in charge of massive tax revenues that have come from the hard working masses doing productive work. In most cases, these people are politicians assisted by government employees in various departments and capacities. The problem that arises is the amount of taxation needed to run a government optimally so that it can perform its functions while at the same time not overburden the taxpayers. Over time, many governments have gotten this mix wrong resulting in taxes that stifle growth and morale of taxpayers while encouraging the rise of illegal underground businesses that try to evade the overbearing taxes. Human greed has also accelerated this problem as tax revenues are stolen by individuals charged with overseeing and accounting for these funds. This means that the funds end up enriching individuals rather than serve the very taxpayer that they were meant to serve. That is corruption.
From my personal observation in Kenya and many African countries, there is a big discrepancy between those who raise tax revenue I.e the taxpayers and those who wait for the tax to ‘administer’ it to different uses. The taxpayer generally does really hard and risky work to realize income. Workers work long hours at low pay only to be taxed further. Business people and investors risk their funds in risky ventures to create businesses that can produce and create income for it to be taxed. Making money in all honesty is very hard work. For this money to be taxed unfairly and the taxes to be stolen to enrich a few individuals is really sad. To the insatiable governments, politicians and their agents, the money is never enough and all manner of schemes are hatched to increase taxes and raise more revenue at the expense of poor taxpayers. You will agree with me that generally, politicians and government workers are well paid. Everyone wants a job in government and its many agencies funded by taxes. No one wants to be in jua kali and be a producer and taxpayer. No one wants to open a factory and produce anything if they can get a well paying government job. No one wants to farm. Everyone wants to be a well paid government employee, receive fat salaries and benefits funded by taxes and build rentals.
Ask yourself, whenever you open a business venture or build anything, the first people you will see even before you see any customers are well fed government agencies employees in their big 4x4 fuel guzzlers coming to see if you have complied with this law or the other. Compliance usually means paying exorbitant fees in licences, permits, levies and in many cases bribes. Whenever government employees including politicians travel and attend seminars and meetings, they are facilitated with hefty per diem and allowances. The tax paying private businesses can only dream about affording such largesse. The tax gobbling government employees are insured and probably under pension schemes. The tax paying public working and doing odd jobs and businesses are left to fate in terms of security of the present and future. The tax gobbling politician and senior government employee are guarded by armed policemen funded by your taxes. Your tax producing business in Gikomba is left at the mercy of thugs and arsonists. Your home as a taxpayer is guarded by the blood of Jesus. Government is the biggest new car buyer. Yes, new car. The taxpayers cannot even afford a new motorcycle. It is even sadder that when you import a second hand motor vehicle from abroad, the amount if import taxes you pay are equivalent of buying another vehicle. In short, when you import a car, you have essentially bought two vehicles, one for you and one for government in form of taxes. And while you cannot even afford to import a brand new car but can only afford a second hand 8 year old jalopy, the government is buying/leasing brand new 4x4 fuel guzzlers for its well fed employees with your taxes. These employees are now well facilitated to come and fleece you at your business with various demands. Don’t forget these same politicians and employees are the same ones who give themselves priority in doing lucrative business with government through proxies by securing tenders and being paid on priority.
In conclusion, the government of Kenya employs less than a million people in its different departments. We have over 20 million working Kenyans in different sectors all of whom pay one tax or the other. Clearly, the biggest employer and opportunity provider is the private sector. But it is the private sector that is doing the most risky and difficult work to secure income for the nation. The government treats and taxes business as if it is easy to do business. I always say, if the government thinks its easy to do business, let it abandon taxes and join us on the ground trying to secure profits and we see how long it will survive in this competitive environment. If those fat bribe seeking officers who come to harass you at your business think it is easy to run and earn from the business, let them open one next door we see how they will fare. If that landlord overcharging your business premises thinks its easy for you to raise rent, let him open one next door and we see how he will fare. These landlords are usually the well fed government employees/politicians eating our tax money to invest in stone and mortar. If that tax paid traffic policeman thinks its easy to run a fleet of matatus or trucks and still pay endless bribes, let him resign and run his own fleet we see how he will fare. No government will succeed unless it addresses the issue of fair taxation. They will always end up hated like Uhuru Kenyatta. He never addressed this issue.
Lastly, government employees do not contribute to any tax other than their personal work and skill. The paye they claim to pay is paid to them first as salary then they refund back to government as PAYE. There is no new money there, that is simply money that the government already had in the first place to pay you. This is money government had raised as tax prom taxpayers in the private sector. Rookie Mp Peter Salasya should know that. We are paying his salary not the other way round.