Has ‘Solomonic wisdom’ deserted Marende?

Photo/FILE House Speaker Kenneth Marende.

By PETER LEFTIE, pmutibo@ke.nationmedia.com
Posted  Friday, July 8 2011 at 22:10

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In March this year, National Assembly Speaker Kenneth Marende was hailed as Kenya’s “indispensable governmental authority in the absence of a will or ability of the coalition principals to act in concert.”

This followed yet another historic ruling that President Kibaki and Prime Minister Raila Odinga consult and agree before appointing the country’s Chief Justice, Deputy Chief Justice and Director of Public Prosecutions.

The ruling was widely praised by Kenyans who feared that the standoff between the two principals over the nominations could slow down if not altogether scuttle implementation of the new Constitution.   

The ruling appeared consistent with the Speaker’s growing reputation as a neutral arbiter and voice of reason within a highly polarised political class.

Hardly four months later, that reputation faces a litmus test following his decision to oppose the constitutional requirement that MPs, like all State officers, pay taxes on their income.

Political commentators warn that Mr Marende risks losing favour in the eyes of ordinary Kenyans thanks to his opposition to the requirement.

Found a better way

“Obviously, his ratings in the court of the public will go down even though he has a basis for taking the position that MPs were given assurances that they will not pay taxes until the end of their term. He ought to have found a better way of going about it,” warned Ford People leader and former Planning minister Henry Obwocha.

Kenya National Commission on Human Rights (KNCHR) official Hassan Omar warned Mr Marende to tread carefully.

“The Speaker must be extremely careful because the matter is of national interest. It is not a matter of who promised who what, it is a constitutional requirement that everybody must pay tax regardless of their station in society. Every time the Speaker has spoken on the issue, he has got it wrong. He should encourage MPs to pay up instead of defending them,” the outspoken commissioner said.

Mr Marende’s opposition to the constitutional requirement appears to have emboldened a majority of MPs opposed to meeting their tax obligations.

 “The basic concept of law is that once you confer a benefit, you don’t take it away arbitrarily,” Mr Marende recently told the BBC.

He maintained that MPs were already paying tax in accordance with the law.

“My position is that as we speak now, Kenyan MPs pay tax as required by enabling tax laws.”

The lawmakers pay taxes on their basic salary of Sh200,000 but their perks, amounting to a minimum of Sh651,000 remain untaxed, a status quo the MPs are keen to maintain until at least after the next elections.

“If the law says Mr Speaker you earn Sh800,000 a month; you are supposed to pay tax on all the Sh800,000. I can assure you that I will be among the first to comply,” Mr Marende told the BBC.

The Commission for the Implementation of the Constitution — the custodian of the new dispensation — has said the Constitution, being the supreme law of the land, requires every State officer to pay tax.

However, Mr Marende has based his position on letters from the Treasury, the Kenya Revenue Authority (KRA) and Attorney General Amos Wako, as well as verbal assurances from the President that MPs will not be required to pay taxes until the end of the current term.

He has also maintained that the relevant laws have not been amended to compel MPs to pay. “I want to state clearly that I believe the provisions of the Constitution and legislation related to taxation should be applied to the letter and that if MPs are lawfully liable to pay additional tax, they should do so in accordance with the law,” he said at a press conference in Mombasa on Wednesday.

“It is important for all to read and interpret the Constitution in totality, including the provisions of the Income Tax Act, the National Assembly Remuneration Act, the Finance Act and any other laws which to date have not been amended nor repealed to realise provisions of the Constitution,” the Speaker said.

He insisted that MPs pay tax “as required by all existing laws beginning with the Constitution and will continue to do so, including payment of additional tax if the law so provides and the requisite assessment is made.” 

But according to the CIC, the National Assembly Remuneration Act, which exempts MPs from paying tax on their huge perks is inconsistent with the Constitution and is therefore null and void.

Has found support
Mr Marende has found support from Justice minister Mutula Kilonzo and Mr Wako among scores of MPs.
According to Mr Kilonzo, “while it is fair to argue that Article 210 of the Constitution binds everyone to pay tax, the use of the word ‘may’ in the same article creates a discretion. Article 210(2) also allows a discretion for a waiver of tax in the case of another legislation,” Mr Kilonzo, a senior counsel, argues.

In the letters which Mr Marende is relying on to argue his case, the AG says the term “tax” is not defined in the new Constitution.

The two letters, written less than a month before the August 4 referendum on the draft constitution, are believed to have influenced a majority of MPs to support the draft as some had threatened to campaign against it if their pay was taxed.
Mr Wako said in one of the letters that the issue of taxation was not “as clear cut as it looks”. He argued that sections of the old constitution dealing with the Executive and National Accord should remain in force until after the next General Election, including MPs’ salaries.

But he admitted that under the new Constitution, “no law may exclude or authorise the exclusion of a State officer from payment of tax”.

Says Saboti MP Eugene Wamalwa: “The Constitution requires we pay taxes because we took oath to uphold the Constitution. But the issue we are looking at is modalities. We should not incite the public against MPs.”

His Cherangany counterpart Joshua Kutuny weighed in: “The Speaker is very right. Parliament is such an important institution and the two principals should know that they cannot dupe Parliament. The Speaker needs to call a kamukunji and invite the principals to explain why they duped MPs.”

That Mr Marende had endeared himself to many MPs was evident at a workshop he presided over in Mombasa to discuss a proposed policy on population.

The MPs cheered loudly when he warned that Kenya’s economic vision can only be achieved with a “leadership that has the moral character, courage and commitment to keep and honour its word.” This was seen as a veiled attack on President Kibaki and Prime Minister Odinga in the tax row.

Political analyst Adams Oloo said Mr Marende’s position could be a strategy to win the support of MPs for re-election as Speaker to the 11th Parliament.

“The Speaker, like MPs, wants to be re-elected. By siding with the MPs, he is playing politics so that they remember him as a defender of their interests,” Dr Oloo said.

“You must give it to the Speaker. Even if he loses face among the electorate, it does not participate in his re-election. It is the MPs who will, so it does not matter to him,” he added.