COTU Scolds Ruto Government’s Additional Tax on M-PESA Transactions

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The workers union through COTU says the Kenya Kwanza government’s plans to introduce additional taxes on mobile money transactions through M-PESA was ill-advised and counterproductive.

On Friday in a statement, COTU Secretary General Francis Atwoli noted that the move will make Kenyans avoid using mobile money platforms and consequently destroy the business of mobile transfers.

“The move by the current government as outlined in the 2023 Budget Policy Statement to have access t and or investigate mobile money transactions, MPESA is ill-advised and counterproductive,” he wrote.

“First, a majority of users of mobile banking are hustlers and the poor who overwhelmingly voted for this government. Second, this move will ultimately make Kenyans avoid using mobile money platforms and as a result, destroy a great innovation that has since helped ease the movement of money, especially from the urban to rural areas,” he added.

The government should ensure that the more than 5,000 outsourcing companies regularize the employment terms and conditions of work for their employees by ensuring that they pay all the statutory deductions including PAYE, NSSF and NHIF among others,” he added.

The COTU boss subsequently implored the President Ruto-led administration to instead launch a crackdown on outsourcing companies whilst formalizing jobs in the informal sector.

KRA, the taxman, has plans to track individuals’ usage of mobile money by monitoring transactions in a bid to squeeze out at least Ksh3 trillion in taxes in accordance with the 2023/2024 budget proposal.

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