This archive report was first published on 3 May 2021.
On May 3, 2021, the National Treasury made a U-turn on its plan to increase taxes on imported furniture, measures aimed at growing local industries.
The Treasury had initially supported a Bill to amend the Excise Duty Act and impose a 30 per cent excise tax on imported furniture, which was expected to promote the local furniture industry.
However, in a recent submission to Parliament, Treasury Chief Administrative Secretary (CAS) Nelson Gaichuhie argued that import duty charged on furniture entering the country was enough to protect the local operators.
According to Gaichuhie, the State uses import duty to protect local manufacturers, and the industry already pays a duty of 35 per cent.
He stated, 'As Treasury, we use import duty to protect local manufacturers. Already, the imported furniture attracts a duty of 35 per cent.'
Gaichuhie also expressed concerns that imposing domestic taxes such as excise duty would be 'inappropriate in protecting the local industries' and could lead to regional trade disputes.
Committee Chairperson Gladys Wanga questioned Treasury's change of tune, noting that Treasury appeared to soften its stand when taxing foreigners but took no pity on Kenyans.
She said, 'When the Bill came up during the pre-publication stage, Treasury made submissions and was in support of the Bill….to come back and say it does not support the Bill is a joke.'
