Wednesday, February 3, 2010

Government should Regulate Prices or Abolish VAT

To alleviate the suffering for Kenyans struggling as a result of the current hard economic times, the government should abolish Value added Tax on essential commodities or introduce price regulation for all foodstuffs. Food is a “human rights issue.” It must be taken seriously by any government. You can do without “shelter” and “clothing” but you can’t do without food. It’s the fuel of life in a human body; without it, you cease to live. If the currently VAT that stands at 16% is scrapped from all foodstuffs, shies of relief will be heaved by many Kenyans. Food will not only be affordable to the country’s poor, it will also spur turnover in the business market. What happens in many parts of the country especially in semi arid regions like Turkana and parts of Eastern province is appalling. People are eating herbs like antelopes. All this is characterized by high poverty index, lack of purchasing power as a result of skyrocketing of prices; brought about by the current inflation. We call upon our political leaders beginning from the President and the Prime Minister to treat the issue of food prices as a national emergency if they have a flair of empathy to the suffering citizens. Conceptualizing Kenya into a free market economy has brought a lot of suffering to our people. I am not an economist but this system doesn’t ease the burdens of the poor. Price control abolished in 1994 must be revived as a matter of urgency. When the government used to control the prices of essential goods like sugar, cooking oil and flour, there was no rampant increase of prices like it is today. As laws are meant to protect the citizens, they can also be changed, altered, augmented, or abolished when they prove to be detrimental to the wellbeing of society. These laws are not “carved” on “stones.” What has proved to be a burden to the citizens must be abolished or changed to suit their needs. It has been proved for instance, that the Kenya Tea Development Agency (KTDA) Act is a diservice to the farmers, through mismanagement of the tea sector. Therefore, the most honourable thing to do is to overhaul the Tea Act; put it on government management so that the interests of the farmers can be taken care of in order to avert further uprooting of tea bushes in some tea growing regions in the Country. It’s encouraging that the Minister for Agriculture, Mr. William Ruto who expressed his displeasure on the running KTDA will be part of the change that will save the tea sector. We don’t want to become anglomanias of social and economic policies that ends up bringing suffering instead of joy to us. Just because it’s working in America or Britain , it doesn’t mean it can work in Kenya as well. The economic liberalization that was thought to boost the country’s economy has hit a toll on many lives. That is why we need price control mechanisms to ensure that majority of those in low income brackets are protected from unscrupulous traders who have taken advantage of the current market to exploit the poor by hiking prices abnormally. Bureaucrats in our Country will dismiss the essence of price control due to the liberalization and deregulation but this policy as failed because it has a negative bearing to the lives of the poor. Any bureaucracy that hurts the lives of citizens must be abolished. The two leaders have the power the legitimacy to ensure that the prices of essential goods are affordable. Parliament as the principal custodian of public interest must be seen to protect the citizens’ interest by amending laws which are archaic to the general good of the country. This is the surest way of protecting public interest. It’s disgusting that our politicians are good talkers and not doers. Mere rhetoric, politicking and strategizing for succession alliances is the order of the day. No serious sign to help struggling Kenyans to enable them acquire decent and affordable life. Even the Prime Minister who has a broad grasp on the problems that bedevil this nation talks good but we don’t see any implementation mechanism from the Grand Coalition government. Kenyans are yet to see the implementation of President Kibaki’s recent directive of scaling down VAT to bring down the cost of electricity, as well as urging Oil Companies to reduce the prices of Petroleum and its products. The price of Oil and electricity defines the market price of most products in the market. What is hard for a government in a sovereign state like Kenya ? If I were Kibaki or Raila, I will advocate, and defending what’s popular and better for the Kenyans masses rather than sticking to policies that do not have a positive impact for the people of this Country. Joseph Lister Nyaringo-Bobasi, Kisii
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