IMF Proposes New Tax Measures To Gov’t

IMF Proposes New Tax Measures To Gov’t

IMF Proposes New Tax Measures To Gov’t

The government has been presented with new tax proposals by the International  Monetary Fund (IMF) subsequent to the approval of a Ksh142.8 billion credit facility. The international financial organization recommended President William Ruto to  implement changes to increase the tax base so that the nation can collect more  domestic taxes in a statement dated Thursday.

However, the Ruto administration has also been urged by the IMF to make sure that there is tax compliance.It was clarified that the action will assist the government in raising funds to pay down its debt.

“A stricter fiscal posture is anticipated as part of the program to assist lower debt  risks and reach the authorities’ debt anchor of 55% of GDP in PV debt by 2029. This calls for the prompt adoption of changes aimed at increasing tax compliance  and widening the domestic tax base. A portion of the statement stated, “These are essential for accomplishing the  authorities’ revenue objectives of reversing the trajectory of the tax revenue-to-GDP ratio while promoting equity and fairness in the tax regime.”

The international financial organization further demanded that the government improve the effectiveness of public investments and implement changes in state companies.The e-Citizen platform is now being used to facilitate the digital delivery of public services, and Ruto’s administration was called upon to expedite this process.

Additionally, the IMF urged for improved subsidy implementation, something that the organization has been advocating for since September 2022, when President William Ruto took office.Most notably, Ruto eliminated the fuel and grain subsidies that President Uhuru Kenyatta had instituted to help Kenyans afford the country’s high cost of living.

The price of fuel exceeded Ksh200 once the subsidies were removed.The IMF claims that the subsidy programs were frequently abused and that only a small number of Kenyans and businesses profited from them.