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Archive for June 22nd, 2011

Kibaki to pay Sh8m tax bill as KRA ropes in top public officers

Posted by Administrator on June 22, 2011

President Kibaki tops the list of public officers from whom KRA is demanding millions of shillings in unpaid taxes since last year’s coming into force of the new Constitution.

Mr Kibaki could pay up to Sh8 million to the taxman based on the Sh24.5 million he is expected to earn in salaries and allowances by the close of the current financial year.

The taxman is also targeting judges, ministers, MPs, permanent secretaries and top military brass as well as those serving in various commissions.

These officers have traditionally enjoyed tax-free benefits — which KRA categorises as any income or allowance — as well as duty-free vehicle imports.

Kenyan presidents have enjoyed tax exemptions since independence under the Income Tax Cap 470, which covers all income derived in Kenya.

“[This includes] that part of the income of the president derived from salary, duty allowance and entertainment allowance paid or payable to him from public funds in respect of or by virtue of his office as president,” says the law.

Mr Kibaki has earned Sh8.4 million in basic salary since July last year and together with allowances will pocket Sh24.5 million at the close of the year next Tuesday. That means he will have to pay Sh8 million to the taxman to be fully compliant with the Constitution.

“No law may exclude or authorise the exclusion of a State officer from payment of tax,” the Constitution says in Article 210(3).

KRA’s tax exemption schedule is a weave of complexity with more 60 clauses — including the rather ridiculous ones such as exempting anyone getting paid off by UK Atomic Energy Authority for discovering uranium in Kenya.

People familiar with the matter said the Kenya Revenue Authority (KRA) has written to accounting officers in the relevant arms of government demanding that all those currently enjoying exemptions under the Income Tax Act pay up as provided for in the Constitution.

On Tuesday, the chairman of the Commission on Implementation of the Constitution (CIC) Charles Nyachae confirmed that he had advised the taxman to enforce this constitutional requirement.

If fully implemented, the Constitution’s demand that no one gets exempted from paying taxes on the basis of their jobs should get a large number of privileged Kenyans and charities back into the tax net.

“The Income Tax Act, Cap 470 and the VAT Act Cap 476, as currently constituted contain clauses that are in breach of Article 210(3) of the Constitution,” said Mr Martin Kisuu, a tax partner with PKF Eastern Africa.

Pressure is expected to mount on the tax-exempt after KRA confirmed the CIC and commissioners in the newly created constitutional offices have been paying taxes on salaries and benefits at the rate of 30 per cent.

At the Judicial Service Commission, Mr Ahmednasir Abdullahi, one of the commissioners, said they have been paying taxes from day one.

“It is true, commissioners serving in the newly established commissions have been paying their taxes,” said John Njiraini, the KRA commissioner in charge of the Large Taxpayers Office.

Enforcers of the Constitution expect stiff resistance from nearly all the parties concerned but the greatest battle is going to be getting members of parliament to comply with KRA’s demand that they pay the relevant taxes effective July last year.

Though the tax noose has been tightening slowly on the necks of constitutional office holders, it has been sure in coming.

The clearest signal came early in the year when the Treasury inked a deal with the International Monetary Fund (IMF) committing Kenya to phasing out exemptions.

The February agreement was signed in return for the IMF’s release to Kenya of $509 million under a three-year extended credit facility (ECF).

Kenya promised to undertake sweeping tax reforms and in particular observe the constitutional requirement that no State officer would get tax exemptions.

A select group of highly placed public officers, including the president, vice-president, Cabinet ministers, MPs, judges and top military brass were exempted from paying a wide range of taxes.
The public has strongly opposed the exemption of MPs from paying taxes and the latest demand by KRA that all public officers pay up to comply with the new law may turn out to be the taxman’s biggest public relations coup ever.

But the taxman must also be ready to confront the MPs wrath – armed by the painful experiences that anyone who has asked them to pay up in the past went through.

Former Finance minister Amos Kimunya learned the hard way when the Finance Bill he introduced in Parliament to nullify the exemptions was amended on the floor of the House, leaving MPs in a tax neutral position.

Mr Kimunya shortly thereafter had to contend with a vote of no confidence in him that was largely seen as parliamentarians’ act of revenge.

Mr Kimunya was hounded from the plum Ministry of Finance job in 2008 after the no-confidence motion against him over the sale of the Grand Regency Hotel passed almost unanimously.

“Given the mood in the country and following the passing of the new Constitution, Kenyans feel that every person should pay taxes,” said Mr Maurice Wangutusi, the tax director at Deloitte.

KRA estimates that the Parliamentary Service Commission (PSC) — whose officials on Monday conceded receiving the demand note — should remit about Sh700 million in income taxes this year, including levies on car imports.

The MPs have been falling back on a letter written by Commissioner General Michael Waweru in the run up to the referendum on the Constitution last year that they would be allowed to serve their full term without paying taxes.

KRA is said to have written the letter based on legal advise from Attorney General Amos Wako. Constitution enforcers now argue that the advise was yet another of Mr Wako’s many masterstrokes meant to mollify the MPs into passing the new law with the knowledge that it would not be worth the paper it was written on once the law came into force.

End up in court

With Mr Wako due to leave office in August, the legislators will be on their own in the fight for tax exemptions that is expected to end up in court for a legal interpretation.

The judges (probably newly vetted) themselves have the enviable role of ruling whether they want to start paying taxes immediately or delay it until August next year.

The die however appears to have been cast given the firm promise that Chief Justice Willy Mutunga made to live by the letter and spirit of the Constitution.

During the Kimunya amendment, which saw the MPs petition the President on the matter, judges were briefly taxed and KRA politely declined to refund them the money when the bill was amended. There is no law for refund of taxes paid under varied laws.

Source: http://www.businessdailyafrica.com/-/539546/1186656/-/nfwnpm/-/index.html


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US trains Kenyan cops on sexual violence

Posted by Administrator on June 22, 2011

NAIROBI, Kenya, Jun 22 – The United States Department of Justice’s  International Criminal Investigative Training Assistance Program (ICITAP) has  trained Kenyan law enforcement officers both from the Kenya Police and the  Administration Police in Nyamira on how to properly investigate and prosecute  crimes of sexual violence.

Thirty-nine area officers, both male  and female, were trained on the provisions in Sexual Offences Act, forms of  gender-based violence, crime scene processing and evidence collection and  preservation and drafting charge sheets.

The training took place at the  Borabu Country Inn in Nyamira town from June 15 through 17.

The US  Department of Justice worked in conjunction with Beatrice Nduta, the director of  Community Policing, Gender Issues and Child Protection at police headquarters,  to organise this training at the provincial level.

“Often police  officers who have left the academy and are stationed at the provincial level do  not get additional training on specialised subjects like sexual and gender-based  violence,” explained Ms Nduta.

ICITAP plans to continue hosting  these trainings in conjunction with Kenyan law enforcement at various provincial  centers across the country.

Nyamira was chosen as the first site of  these provincial trainings because of its relatively high incidence of sexual  violence.

ICITAP has written an entire curriculum on gender-based and  sexual violence investigations and has offered multiple courses based on this  material for Kenyan law enforcement.

Police trainers for ICITAP have  taught at both the Kenya Police College in Kiganjo and the Administration Police  Training College in Embakasi.

ICITAP has made a great effort to include  both agencies in all of its trainings in anticipation of the creation of the  National Police Service mandated by the new constitution.

The Nyamira  training was fully funded by ICITAP’s Women’s Justice and Empowerment  Initiative.

Source:  http://www.capitalfm.co.ke/news/Kenyanews/US-trains-Kenyan-cops-on-sexual-violence-13302.html#ixzz1Q0aaj2ca

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Another Kenyan soccer payer set to hit big

Posted by Administrator on June 22, 2011

Victor Wanyama currently plays in Belgium for Germinal Beerschot

Victor Wanyama currently plays in Belgium for Germinal Beerschot

Neil Lennon’s  bid to add a Kenyan international to his multi-cultural Celtic squad could be  dependent on getting the green light from the  San Siro.

Victor Wanyama is the million-Euro target for the Hoops. But the teenage midfielder, currently playing for Belgian club Germinal Beerschot, is heavily influenced by his older brother, McDonald Mariga, who plays for Inter Milan.

Wanyama is an orphan, and the career of the man who won his first full cap for Kenya as a 15-year-old has been directed by his sibling since he  left his homeland to join  Helsingborg’s youth set-up  in Sweden.

McDonald Mariga gave his little brother his blessing to accept the chance to move to Belgium three years ago, and he is once again helping direct operations as the kid who turns 20 this week prepares to make his next big move.

Beerschot are awaiting a formal offer from Parkhead, but appear resigned to the  fact they are about to lose  the player.

In fact, they have already signed his replacement, Sani Kaita, a Nigerian who is  moving from Salonika in Greece and will arrive in  Antwerp on Friday.


Press officer of the  Juliper League club,  Danny Geerts, is aware Wanyama is being pursued, and believes 24-year-old  McDonald Mariga will have a big say in what the youngster  decides to do, with other interest surfacing from Premier League new boys Swansea City today.

He said: “His brother is a very big influence on Victor, and a good influence. I am sure he will be giving him advice.

“It is on the cards that  Victor is going to leave  because he is very talented.”

Celtic hope they can  convince all involved that they offer the best career move  for the powerfully-built  midfielder, who can also play in central defence.

The indications are he could become Lennon’s first purchase in this transfer window, but progress has to be carefully negotiated as the paperwork could be a complication,  because Wanyama does not hold a European Union passport.

Indeed, when he joined Beerschot, there was a delay because he has no parents, and the Belgian authorities were reluctant to allow him to move to the country until arrangements were put in place for him to receive the support  required for an individual of his age.

“There were problems  getting a visa for Victor, and he needed someone in Belgium to agree to look after him,”  explained Geerts.

“There was a lot of red tape to get through. But eventually we got it sorted and he was able to sign.”

Beerschot saw Wanyama as a long-term project, like so many of the teenage players Belgian clubs bring in from Africa. However, he soon showed enough in their youth set-up to merit promotion to the first team.

Initially, Wanyama was  deployed in a holding midfield role where his 6ft 2in frame  allowed him to protect the back line.

However, he was moved back into defence as Beerschot struggled in the league, and Geerts admitted the teenager found it tough to adjust.

“In the first game he played in defence, away against  Anderlecht, he was red- carded,” he recalled.

“That was down to his inexperience, and he had to learn what challenges he could and could not make.”


Even when he reverted to midfield, Wanyama’s  robust style kept the  referees busy. Most recently, he served a four-game suspension after being caught on  video elbowing an opponent, an incident missed at the time by the match officials.

The physical nature of the SPL would hold no fears for Wanyama, who Geerts reckons has already shown he can more than look after himself.

“Victor is strong, good in the air, quite quick across the ground, and has a good  attitude on the field.”

However, Geerts’ summation of the prospect carried the caveat: “The down side is his attitude off the field. Let’s just say there is a lot for young men to do in Antwerp.”

In the 12 months Celtic have been tracking Wanyama, they have had every opportunity to assess his behaviour on and off the field, and are clearly satisfied that he is continuing to mature.

He was one of the few  successes in a struggling  Beerschot side last season, and the club are not surprised that the interest in him is growing as a result.

“West Brom were mentioned last summer, and two clubs from Russia asked the club if he would be willing to move there,” added Geerts.

“At first, Victor was not keen on a move to Russia. But when the money they were willing to pay him was mentioned, he  became more keen. However, no offers came in for Victor, and he continued to play for us.”

Beerschot – who have  appointed Dirk Schoofs as their new team manager after a season fighting against  relegation – are refusing to go public on the fee they are seeking to obtain for Wanyama.

But a price tag of around £900,000 appears to be the  trigger which could fire him towards Parkhead – big  brother permitting.

Source: http://www.eveningtimes.co.uk/sport/editor-s-picks/big-brother-is-watching-as-kenyan-kid-ponders-hoops-move-1.1107989

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