Brace yourselves for even tougher times Country people for the Government is likely to borrow another Sh600 billion this financial year after revenue shortfalls, pushing the country deeper into the debt trap.
This is despite the glaring fact that President Uhuru Kenyatta is hell bent on imposing the a pinching tax on fuel and that the gap between spending and revenues has continued to increase.
The budget deficit has grown to Sh600 billion, with tax revenues expected to drop to Sh1.8 trillion, down from Sh1.9 trillion projected in the 2018/19 Budget.
Finance Principal Secretary Kamau Thugge said the dismal results from the tax man made the Government to revise its expectations.
“We had made projections based on what we expected KRA would collect but performance was bad, especially the last three months and so we had to adjust,” Dr Thugge said.
Pressure now shifts to KRA, whose task has been made even more difficult after Parliament threw out tax proposals, including 0.05 per cent tax on transactions above Sh500,000 and 0.5 per cent tax for a housing fund.
KRA has had a history of under-performing on Treasury tax targets and in May this year, Treasury had to reduce tax estimates to Sh1.415 trillion.
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