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How to Resolve the Kenyan Budget Deficit

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Business Daily Africa report that the Treasure is scrambling to cut costs in a bid to shrink the Ksh127 billion hole that has opened up in the nation’s finances. All “non-essetial ministry expenses” are under review and the privatisation of public companies is going to be brought forward.

You can’t read the full article unless you’re subscribed to BDA’s e-paper, but the general gist is: we’re screwed. Development expenditure is probably for the chop, as are social programs and poverty reduction. With the Kenya Revenue Authority (KRA) operating at a performance rate of 96.3%, there is little room for finding extra revenue as the economic downturn continues to bite.

But wait, what’s this? As the excellent Kenyan Entrepreneur blog points out, a whopping (not “whooping,” Nation journalists) 80% of the revenue collected by the KRA goes to paying salaries and allowancs for our beloved kleptocrats elected representatives. That’s more than a pretty penny. And it is untaxed. Now, I’m sure it would seem odd to our MPs to collect money from the Treasury, only to give some of it back, but we’re all in this together, aren’t we? I’m sure that if the situation was explained to them – in words of less than three syllables – they’d be only too happy to help out.

In addition, after the sanctions against Chinese construction firms, the government might want to look at some of the infrastructure projects in the pipeline. After all, one of the firms was guilty of graft on a road construction project in the Philippines; perhaps we could drive down the price for the Thika Road and other road construction projects. Yes, I know it’s boring sitting in meetings going over the particulars of complicated contract clauses, but our MPs earn their money by representing our best interests. Have no doubt that they are, at this minute, drafting new conditions that will get us more bang for our buck.

Of course, now that Obama has been elected, we ought to expect a flood of tourism dollars, as curious Americans make the pilgrimage to Kogelo to interrogate Mama Sarah about her grandson’s origins. Forget my earlier cynicism and the fact that the American economy is in the toilet! There’s bound to be several thousand millionaires who have nothing better to do than to visit Nyanza province, surely? After all, businesses run themselves, especially during the worst global financial crisis since the Great Depression. If they tack on a sand-and-safari package to their trip, the tourism sector will be saved, the KRA will collect more revenue, and the budget will be back on track.

So there is actually very little too worry about. Those of us earning enough money will continue to pay our punitive reasonable taxes, MPs will chip in to help out and tourism dollars will flow in. You see? Quite frankly I don’t know what the Treasury is so worried about. It’s not like the majority of Kenyans live on a dollar a day and can’t afford to pay more taxes.

NB. The above post may contain sarcasm

[Image by Esparta]



  1. Nigel says:

    Great read, sad this exists in Kenya

  2. derrick says:

    good idea only needs implementing

  3. […] is expected to be the next big privatization project to help plug the current Government of Kenya budget deficit. The IPO transaction adviser selection process is already underway for KPC and other state […]

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