It’s no longer a big deal to find Kenyan youth seeking employment abroad to improve their standards of living. They do so in the belief that the nation cannot offer them jobs. In truth, the waters of jobseekers are muddy from corruption, and to secure a job in Kenya you may have to bribe.
Kenyans living abroad are kind enough to work overtime to see their families bloom. They sent home Sh453 billion in 11 months to last November. The remittances were mainly used to cover medical expenses, pay school fees and fund start-ups.
Invests in start-ups injects money into the economy and creates employment that the government has failed to. This is essential for poverty reduction as the earnings help put food on the table.
The hard-earned remittances should not be taxed as that would leave dependent households dissatisfied and projects unfulfilled. The cashflows from abroad increase families’ resilience and improve financial literacy and asset accumulation.
The irony is that the government openly watches as a good number of talents leave the country in search of employment yet still expects to tax the remittance. Taxing the diaspora will discourage investments and production in the future.
The taxman should, instead, elevate their technology to stop tax evaders in their tracks. Yet some Kenyans lead opulent lifestyles but don’t pay taxes.
The government should start by addressing the biggest culprit: Tax fraud. By continuously investigating cases of tax evasion and avoidance, Kenya Revenue Authority (KRA) will successfully achieve its targeted revenue.
Mr Olage is a banking and finance specialist. [email protected]