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State Officials Violating Act78 of the Constitution to Be Sacked

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The National Assembly has unanimously approved the nomination of Twalib Mbarak as The Ethics and Anti-Corruption Commission Chief Executive Officer. Photo - The Standard

An investigation to seek out public officers in violation of act 78 of the constitution has been launched by the Ethics and Anti-Corruption (EACC) has been launched.

EACC’s boss, Twalib Mbarak, stated that for officers found in violation of the article, measures to teach them a lesson would be put in place.

Article 78 of the constitution states that state officers or members of defense forces are not allowed to be in possession of dual citizenship and also that for a person to be eligible for election or to have position at the state office, he or she should also not possess dual citizenship. The article also states that these clauses are not applicable to members of commissions, judges or any other person who has no way of opting out of citizenship from another country by operation of that country’s law.

In a press statement on Thursday last week, Mbarak stated that anyone found to be in violation of the leadership and integrity act will be removed from office. This move comes as a result of MPs who asked the EACC to carry out investigation on state officers who are suspected to be in possession of citizenship to not one but two countries.

The members of parliament had given claims that some state officers, some of whom have received approval from the parliament are in possession of dual citizenship which is contrary to act 78 of the constitution. This matter had been brought by the debate on whether Mwende Mwinzi should be posted to Seoul, Korea as an ambassador yet she holds US Citizenship. The chairman of committee on Defence and Foreign Relations, Katoo Ole Metito, made the call claiming a number of Principal secretaries, Cabinet secretaries, Governors and MPs hold dual citizenships.

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KRA Tracks Down Rich Sh.250 billion Tax Cheats

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The Kenya Revenue Authority detectives have singled out tycoons and companies that are in tax debt of an estimated Sh.250 billion.

The KRA intelligence and strategic operations, which comprises of about 100 investigators has in recent months been investigating the sources of income and the expenditure of wealthy people that are against their tax settlement.

Some of these rich people and companies that have found themselves in the wrong side of the taxman include Humphrey Kariuki and owners of Keroche Breweries Tabitha Karanja and her husband Joseph Karanja. They have been charged in court, where they are facing allegations related to not paying their dues that are running into tens of billions of shillings.

The KRA Commissioner – General, Githii Mburu, last week said that the surveillance of the rich and the companies has revealed the potential to collect 250 billion that remains unpaid to them.

“We already have established and it is in our record (the Sh250 billion). Whenever we profile a company or an individual taxpayer, we look at what they are earning, their sources of income and everything else vis-a-vis what they have declared,” Mr Mburu told the Public Accounts Committee (PAC).

He also added and said that they have profiled and notified the individuals and that KRA is aggressively pursuing business people.

Kenya’s tax revenues for the year to June rose 9.6% compared to last year to Sh.1.49 trillion. However, KRA still missed its collection target by Sh.91.2 billion due to sluggish corporate earnings, reduced economic activity and freeze in hiring amid job cuts.

KRA enforcement unit is using bank statements bank statements, import records, motor vehicle registration details, Kenya Power records, water bills and data from the Kenya Civil Aviation Authority (KCCA), to track down suspected tax cheats.

Those of whom are driving high-end vehicles and have unsettled dues will be identified through their car registration details. The landlords will also be tracked down via Kenya Power meter registrations, of which some of them have huge tax demands.

“There are those who are already in the tax base but don’t pay correct taxes. We have those who have payroll numbers but they don’t declare income from their properties like rent,” said Mr Mburu, adding that the individuals are now on the KRA radar.

KRA’s quest to bring people into the tax brackets and curb tax cheats is fro the purpose of meeting the revenue targets that it has persistently missed in the recent years.

This has now posed pressure upon the Treasury and the Kenya Revenue Authority to widen the tax net and bring down on cheats and companies amid the growing expenditure needs.

The authority has hired a team of auctioneers to help it track properties of individuals and companies who have failed to pay the tax due.

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You Might Want to Get Rid of the Old Banknotes As Soon As Possible.

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If you are still holding an old Sh.1000, you might encounter difficulties in making any transactions from 26th September at different retail centers and also banks, petrol stations, matatus and telecoms.

Central Bank of Kenya  ordered for the return of the old generation Sh1,000 notes during Madaraka Day celebrations on June 1, 2019 when the new generation banknotes were unveiled.

The business community says that they will need enough time to exchange the old notes, despite the notice given by the Central Bank of Kenya.

Safaricom, the largest telecommunication company notifys its users of the inability to buy airtime or make M-pesa deposits from any Safaricom outlets using the old bill.

“Following the demonetization of Sh1,000 note, we advise that the last day to collect the old currency at Safaricom shops will be Thursday,” reads a notice from Safaricom’s regional operations noticeboard.

The CEO of Kenya Bankers Association, Habil Olaka says that Kenyans are still able to trade in their old notes from any commercial bank before close of business on September 30.

“If one has a million shillings or less, they can be able to walk into any bank and change the money. However, if they have more than a million then it’s advised to exchange the notes at the bank they bank with, if not they are to seek clearance from CBK,” he said.

According to the statistics from Central Bank of Kenya (CBK) it shows that more than 150 million pieces of the old Sh1000 notes have been exchanged so far.

The introduction of the new banknotes was meant to cause a disruption in the multi billion-shilling fake currency business in Kenya and across the region.

As the old Sh.1000 notes are to be deprived of it’s value, the old Sh. 50, Sh.100, Sh.200 and Sh.500 will be phased out with time.

Kenya is not the first country to go down this route. India, Zimbabwe, Ghana, United Kingdom, North Korea, Pakistan, and Australia are just but a few of the countries that have tried changing their currencies. To some, this step has had a positive impact while to others it has had an undesirable effect.

Pakistan in 2016, Australia in 1996, UK 2002 and Zibambwe attempted in 2015 and succeeded having considered using the US dollar.

In 1982, Ghana also tried out this move when it ditched its 50 cedis note to deal with rampant tax evasion and empty excess liquidity. It had the downside of fueling a currency black market.

North Korea attempted this in 2010 but ended up not meeting the citizen’s basic needs such a food and shelter after Kim-Jong ll knocked off two zeros from the face value of the old currency in order to kick out the black market.

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CBK Raises Alarm over the buying of wheat with “dirty money”

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In the quest of scrapping out the old Sh.1000 note by 30th September, the Central Bank of Kenya (CBK) has raised alarm over people with dirty money buying wheat in Narok County in order to clean up as it’s deadline approaches.

The CBK maintained that there will be no extension of the deadline whatsoever.

No one is exempted from this exchange. The CBK Governor, Patrick Njoroge said that they are working hand in hand with the judiciary so as to ensure that prisoners who deposited old notes are also allowed to exchange. This will include the millions in form of old notes that are being used as exhibits by various courts in the country.

He also added that judiciary officials who will not have exchanged their notes will be rendered worthless  after next week.

This will not affect the Sh.50, Sh.100,Sh.200 and Sh.500 for they will be phased out with time.

According to Dr. Njoroge, the phase out of Sh.1000 note will aid in dealing with cases of counterfeits and money laundering, which has had a negative impact on Kenya’s economy.

The phase-out is expected to be a success just like in similar places that did the same and it had a positive impact on the economy for example Pakistan in 2016, Australia in 1996, UK 2002 and Zibambwe attempted in 2015 and succeeded having considered using the US dollar.

However, this money exchange might on the other hand have a negative impact as it has on several countries. In 2016, India scrapped 500 and 1000-rupee bank notes to flush out tax evaders.

Although, this did not get the desired effects as 99 percent of the money still got back into the system.

Nigeria also introduced new currency and banned the old notes in 1984, under the Muhammadu Buhari government. This action became chaotic and was blamed for the inflation that followed and crashed the economy.

In 1982, Ghana also fell prey to this move when it ditched its 50 cedis note to deal with rampant tax evasion and empty excess liquidity. It had the downside of fueling a currency black market.

North Korea attempted this in 2010 but ended up not meeting the citizen’s basic needs such a food and shelter after Kim-Jong ll knocked off two zeros from the face value of the old currency in order to kick out the black market.

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