The 2.5% motor vehicle charge that was originally planned in the Finance Bill 2024 has been cancelled by the Kenyan government due to its anticipated negative effects on the insurance sector.
According to the radio station CapitalFM, Mr. Kimani Kuria, the chairwoman of the Finance and Planning Committee, informed the local media that the idea would have rendered the insurance business unsustainable.
“We have agreed that the motor vehicle tax cannot be amended through an Income Tax Act, and pegging it on insurance would cripple the insurance business and make it difficult for Kenyans taking third-party insurance,” said Mr. Kuria.
Treasury Cabinet Secretary Njuguna Ndung’u had stated that he planned to impose an annual motor vehicle tax of 2.5% of the car’s worth, subject to a minimum of KES5,000 ($38.65), in order to increase the tax base and establish Kenya’s independence.
In the event that the plan was approved, auto insurance would face penalties for neglecting to collect and submit the tax to the Kenya Revenue Authority (KRA).
The Association of Kenya Insurers (AKI) encouraged the National Assembly to remove the proposed automotive circulation tax from the Finance Bill, 2024, in a statement released in May 2024.
AKI said, “With motor vehicle insurance being compulsory in Kenya, we anticipate a major shift towards third-party motor insurance if this tax is implemented. Consequently, motorists will face higher risks, as they will essentially only be covered for third-party liabilities, leaving their vehicles unprotected in the event of accidents. This could burden motorists with significant out-of-pocket expenses for repairs or replacements.
“Moreover, a shift towards third-party coverage will lower insurers’ income, which will translate to lower corporate tax contributions. Additionally, a reduction in insurers’ income will prompt downsizing the workforce, subsequently reducing employee tax revenues to the government.”
![Rev. Fr. Anthony Odiong, a US-based Nigerian Louisiana Catholic priest, was arrested in Florida on Tuesday for possessing child pornography, according to law authorities. The suspect is reportedly accused of many other cases of sexual assault. The Waco, Texas, Police Department announced in a Facebook post on Tuesday that officers detained Father Anthony Odiong in Ave Maria, Florida, with assistance from the United States Marshals Service. Waco police announced in March that they had received "credible information" about a sexual assault allegedly committed by Odiong in Texas in 2012. “During the subsequent investigation, a case of possession of child pornography was uncovered,” the police said. The priest was apprehended in Florida by the Caribbean Regional Fugitive Task Force. The Waco Police Department said that he will be extradited to Texas. Odiong had previously served in the Archdiocese of New Orleans before being removed as priest in December of last year due to controversy over homilies in which he claimed, among other things, that the Catholic Church was being taken over by "the gays." At the time, the priest was also accused of abusive behaviour; a Louisiana lady claimed in U.S. bankruptcy court that Odiong had committed both financial and sexual abuse against her. Prior to joining the New Orleans Archdiocese, Odiong served in at least two Texas parishes. On Tuesday, Waco police stated that during their sexual assault investigation, "the presence of other survivors was revealed." “Multiple women have come forward to tell similar experiences as the sexual assault survivor who reported the initial allegation,” the police department said. “Survivors’ experiences ranged from sexual assault and indecent assault, more commonly recognised as groping, and financial abuse, with some survivors experiencing every element of Anthony Odiong’s manipulation.” The police said they “believe there may be more survivors, and we wish to speak with anyone who [has] had similar encounters” with the priest. The Archdiocese of New Orleans issued a brief news release on Tuesday noting Odiong's arrest in Florida. The archdiocese “encourages anyone with any information to contact law enforcement,” the release said.](https://chronicle.ng/wp-content/uploads/2024/08/ezgif-6-4730550ede-450x300.jpg "Odiong: US-based Nigerian Catholic priest convicted over sexual assault")
