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Kenyans warn MPs that 2022 election is coming as they mull over Uhuru’s 8% VAT proposal

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The government risks losing about Sh100 billion it badly needs to fund this year’s budget if MPs gang up to shoot down President Uhuru Kenyatta reservations on the Finance Bill.

Among areas targeted in the memorandum include the eight percent levy on fuel products that will see about Sh17.5 billion realised, sugar confectioneries (Sh475 million), money transfers (Sh11.4 billion), betting companies and winners (Sh30 billion), the housing fund (Sh10 billion) and kerosene (Sh9.8 billion).

HUGE DEFICIT

On Tuesday, the National Treasury presented supplementary estimates to the House, proposing to slash its Sh3.026 trillion budget by about Sh55 billion.

If the MPs make good their threat to shoot down the president’s proposals during a special sitting on Thursday, it will leave the government sweating over how it will plug the huge deficit in the budget.

Of the entire budget, the Kenya Revenue Authority is only able to raise about Sh1.6 billion in ordinary revenue – including VAT on fuel products that the MPs have openly opposed on account that it will overburden the already overtaxed Kenyans.

Treasury Cabinet Secretary Henry Rotich when he appeared before the Finance and National Planning Committee of the National Assembly on September 19, 2018. PHOTO | FILE

On Tuesday, President Kenyatta formerly cited his reasons to MPs for returning Finance Bill, 2018 to MPs for reconsideration.

READ ALSO:   VIDEO: Uhuru between a rock and a hard place over external debts

The bill – which was passed two weeks ago – gives the government the legal framework to finance its budget.

ROTICH’S PLEA

Yesterday, National Treasury Cabinet Secretary Henry Rotich pleaded with the MPs to consider the bill with the President’s proposed changes.

“We reformed the tax law in 2013 because almost everything – about 435 items were tax exempt. This was done to expand the tax base because over time, we have been losing revenue because of the narrow tax base,” Mr Rotich told the MPs.

The committee chaired by Kipkelion East MP Joseph Limo is considering the president’s memorandum on the bill that has also proposed to delete the 0.05 percent ‘Robin Hood’ tax, which had been proposed on money transfers of at least Sh500,000.

The CS instead announced that the government plans to recoup lost revenue through the 20 percent imposed on the charges the banks levy customers in money transfers, meaning that the transfer charges could still go up.

There is also a new proposal to increase the price of kerosene by Sh18 per litre, to check adulteration of fuel, as well as split the current 35 percent tax on betting companies to include the winners.

MITIGATION MEASURES

READ ALSO:   VIDEO: Perhaps eager to talk to God alone, Uhuru stuns churchgoers after attending mass without security

But even as the government does this, it is yet to put mitigation measures – zero rating of liquefied petroleum gas (LPG) and increasing cheap electricity connection, to cushion the poor from the high prices.

Currently, the government is only able to raise about Sh8.7 billion in the betting industry.

This will see betting companies charged 15 percent on top of the 30 percent charged in terms of corporate income and winners 20 percent.

“This is a punitive taxation measure. If you want to engage in the luxury of betting, you give the exchequer money,” Mr Rotich said.

THE VOTE

The committee is required to table a report recommending its adoption or rejection on Thursday morning.

It will require at least two- thirds or 233 of the 349 MPs to either alter the president’s view or shoot it down all together.

The MPs were also united against the taxes on sugar confectioneries, arguing that it will make the country uncompetitive in the region in terms of manufacturing – sweets, candies, biscuits, chocolate and other products.

“Why discourage local manufacturers?” Mr Limo posed. “Kenya is the centre of confectionery in the East African region. This levy may lead to uncontrolled importation,” he said.

READ ALSO:   CORRUPTION: Kenyans in US want their country "closed for renovations" [PHOTOS]

Mr Rotich explained that the levy on the confectioneries is one of the sin taxes imposed by the government to regulate the consumption of such products.

He argued that the cost of treating complications related to the consumption of the products far outweighs the benefits.

“We are here complaining about the tax yet we are spending more on health challenges. By discouraging this, you are protecting the health of Kenyans, including children. This provision is meant to raise revenue for development,” Mr Rotich said.

“These are the recommendations of the World Health Organization (WHO) and it is where the world is headed.”

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Business

Foreign students rethink US business schools

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This summer, dozens of incoming students at New York’s Columbia Business School had planned to sail around the coast of Croatia for a week to get to know each other.

Instead, they are chatting online and playing icebreaker games on Zoom. With the coronavirus still spreading, social gatherings like the sailing trip organised by students are on hold, and there is a good chance that when school starts in September, many classes and events will be held online.

Columbia and other elite US business schools like Harvard Business School and the Wharton School at the University of Pennsylvania have said they will likely move to a “hybrid” model of virtual and in-person learning. It is a far cry from the typical MBA experience which features close contact with fellow students, in-person networking events, trips overseas and lunch sessions with CEOs.

The changes have some students reconsidering the value of a degree that can cost upwards of $100,000 (Sh10 million) a year in tuition, housing and other fees.

International students, who make up roughly 35 per cent of the student body at most elite US business schools, are particularly unsure about the decision.

“The virtual environment might take away a chunk of the MBA experience,” said a 27-year-old student from China who was admitted to Wharton and is considering whether to defer for a year.

READ ALSO:   UHURU'S BEAST: Kenyatta now has two identical cars, just like the US President [VIDEO]

“That’s what a lot of people including myself are thinking through now,” said the student, who declined to be identified because of concerns about his visa status and employment prospects

. Education upended

The United States has been hard hit by the coronavirus outbreak, with more than 1.7 million cases and over 100,000 deaths.

Higher education has been upended with most schools sending students home in the spring and moving classes online. The US hosts over a million international students at its higher education institutions, according to the State Department data.

International candidates account for 36 per cent of people who enroll in full-time US MBA programmes, according to Graduate Management Admission Council, an association of business schools.

If institutions do not resume in-person learning, enrollment, particularly among international students, is likely to take a hit, according to a GMAC survey. Only 43 per cent of the international MBA candidates surveyed said they planned to enroll if programmes begin online. Forty-eight per cent of them indicated they would defer in that scenario.

By Standard Business

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Danger online as traffickers target helpless children

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International organisations have raised a red flag over the spike in online human trafficking and child exploitation as people spend more time at home.

With Covid-19 restrictions and more children spending more time online, human traffickers are using the opportunity to recruit, groom and exploit children and lure adults feeling the pinch of the emaciated economy as a result of the coronavirus.

The concern is even more real after a German was arrested on May 4 in Nairobi in the company of a 13-year-old boy alleged to have been trafficked from Nyalenda in Kisumu.

Thomas Scheller, 71, who is in Kenya illegally, beat all the travel restrictions to travel from Kwale to Kisumu and back to Nairobi.

The boy — one of his victims — was defiled between April 30 and May 4. It took the combined efforts and intelligence of Interpol and Directorate of Criminal Investigations (DCI) to nab the alleged trafficker classified as a serial offender. Scheller faces six counts of trafficking in persons, child pornography and defilement of five boys aged between 10 and 13.

Local and international organisations attribute the surge in online exploitation of children to the interruption of their physical learning and a change in their daily lives due to confinement affecting many parts of the world.United Nations Children’s Fund (Unicef) Regional Advisor Rachel Harvey estimates that a third of internet users are children, with internet usage increasing by half, following the stay-home orders adopted by most countries to help contain the spread of Covid-19.

READ ALSO:   DP goes missing on social media

Whereas the increase is positive for continuity of education and social life, Harvey warns that it has put children at risk of online sexual exploitation.

“Before Covid-19, it was estimated that there were 750,000 people looking to connect with children for sexual purposes online at any one time. Opportunity and triggers for offending created by containment are likely to have pushed up that number, as well as demand for child sexual abuse materials,” Harvey says.

With limited physical interaction, global trends further single out increased and growing demand for child abuse material. This has given traffickers opportunities to devise new avenues of animating the ‘lucrative’ business of sex tourism by leveraging on the online space to prey on susceptible and unwitting users.

Lawrence Okoth, Internet Crimes against Children Investigator, confirms the nerve-racking trend in Kenya, with the unit based in Nairobi receiving about 300 cases per month of child abuse material and messages meant to lure and recruit victims. “The numbers are quite high and many more actually are not being reported,” Okoth says.

The traffickers are tactical in their approach, hence the big and growing number of victims. Okoth says traffickers stalk their victims. First, they identify their vulnerabilities and then offer a shoulder to lean on and camouflaging as ‘good friends’ with ‘common interests’ such that sharing of nudes becomes easy.Inadvertently, victims find themselves entangled in a compromising and perilous situation.

READ ALSO:   VIDEO: Perhaps eager to talk to God alone, Uhuru stuns churchgoers after attending mass without security

“Traffickers build confidence with their victims online by sharing conversations that lead to connection and consequently detach their victims from their parents/guardians.

This connection paves way for physical connection offline. With the new-found ‘friendship’ as a stepping stone to invade the victim’s life, traffickers manipulate their victims and whenever their missions are not accomplished, the shared nudes and erotic videos become weapons of blackmail used to force them to comply with any sort of demands, which also include substance abuse.

“In most cases, the traffickers order the victim to recruit other students or their friends and with time, the chain grows and the number of victims multiplies,” Okoth says.

It has further been discovered that traffickers employ other tactics of observing current trends and creating links with names that children identify and relate with indubitably. “We have come across groups such as Class Eight Revision, KCPE 2020 Class and other names that children easily join without questioning their genuineness,” he says.

The bigger concern, Okoth says, is that children and youth are being recruited and exposed online without the knowledge of their custodians. Valiant Richey, Special Representative for Organisation for Security and Cooperation in Europe (OSCE), describes the scale as unimaginable and growing, with “traffickers recruiting children through many online venues, including social media, game platforms, and chat rooms. They will typically befriend the children, grooming them for sexual activity and then gradually exploit them in various ways.”

READ ALSO:   VIDEO: Uhuru between a rock and a hard place over external debts

In Kenya, detectives have identified different locations in slums in Nairobi and Mombasa where traffickers congregate relatives (mostly children) in sneaky rooms and entice them into sex orgies for purposes of live streaming.

[The writer is a fellow of the 2020 Resilience Fund of the Global Initiative against Transnational Organised Crime]

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Kenyan scientist Muthoni Masinde created an app that predicts droughts

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An app is combining weather station data with the traditional knowledge of African farmers to predict droughts.

To help prepare farmers for the effects of climate change, Kenyan computer scientist Muthoni Masinde has created mobile platform ITIKI.

The name stands for Information Technology and Indigenous Knowledge, and the platform sends farmers drought forecasts via an app or SMS message.

Although it uses meteorological data, Masinde says most African farmers can better relate to the traditional knowledge that is also used to formulate the platform’s predictions.

“I grew up in a [Kenyan] village and I noticed that most farmers do not have any form of science to tell [them] when to plant,” Masinde told CNN Business.

“They watch insects, they watch the behavior of animals and then they make a decision, ‘I think it’ll rain in two weeks’ time.’”

ITIKI employs young people in farming communities to gather photos and updates about animal behavior and local vegetation, such as which trees are flowering.

They capture their findings on the ITIKI app, and ITIKI collates this information with data from local weather stations to model weather patterns months in advance.

Farmers can subscribe to the service for just a few cents, and receive regular updates in their local language, helping them make early decisions about which crops they should grow and whether to sell or save their produce.

READ ALSO:   DP goes missing on social media

Economic impact of drought

Many African countries are especially vulnerable to climate change and small-scale farmers in particular, who rely on rainfall for their harvests, could face poverty and food insecurity, according to UN climate experts.

That could have major economic repercussions. Agriculture contributes about 15% to Africa’s total GDP, according to a 2017 UN report, and accounts for around half of the continent’s employment, according to the African Development Bank.

Now a professor at the Central University of Technology Free State, in South Africa, Masinde launched the app in 2016 in Kenya, where agriculture makes up around a third of GDP.

“Investments in climate adaptation solutions, especially targeting small scale farmers, would lead to GDP growth [in Africa],” said Masinde.

She added that African governments tend to react to drought and extreme weather, rather than proactively planning for these events.

“We do not prepare for [drought],” she said. “It’s like we just wake up and discover that people in rural Kenya are starving, that people on one side of the country have no rain.”

Masinde says ITIKI is now used by more than 15,000 farmers in Kenya, Mozambique and South Africa. Since farmers started using the app their crop yields have increased by an average of 11%, according to Masinde.

READ ALSO:   VIDEO: Uhuru meets British PM Theresa May in London

ITIKI has received $750,000 in funding from the US and South African governments, which will be used to scale up operations. By the end of this year, Masinde hopes to have signed up over 100,000 farmers to the platform.

BY Citizen

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