Wako advised Marende MPs were tax exempt

Photo/FILE National Assembly Speaker Kenneth Marende (right) hands over the Draft Constitution to Attorney General Amos Wako on April 7, 2010 at the Parliament Buildings, Nairobi. On the issue of MPs taxation, Mr Wako said it was not “as clear cut as it looks”.

By NJERI RUGENE nrugene@ke.nationmedia.com AND SAMUEL SIRINGI ssiringi@ke.nationmedia.com
Posted  Monday, July 4 2011 at 22:30

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Attorney General Amos Wako wrote two letters to the House Speaker advising that MPs should not pay tax in their current term.

Mr Wako, the chief government adviser, also said the term “tax” was not defined in the new Constitution.

The two letters were written less than a month before the August 4 referendum on the draft constitution.

The letters are believed to have influenced a majority of MPs to support the draft as some had threatened to campaign against the document 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”.

Mr Wako 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.

In the letters that he described as “my opinion”, Mr Wako said requirements in the new constitution that would have made it mandatory for MPs to pay tax would be suspended until after next year’s General Election.

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

Justice Minister Mutula Kilonzo has said the use of the word “may” would be used discretionally, meaning that MPs could be exempted from paying taxes nonetheless. (READ: Mutula speaks out on MPs’ tax)

Under Article 260, Mr Wako said, a state officer includes a Member of Parliament.

“All law in force immediately before the effective date continues in force and shall be construed with the alterations, adaptation, qualifications and exceptions necessary to bring it into conformity with this constitution,” he said, quoting from paragraph 7(1).

“This means the National Assembly Remuneration Act which exempts MPs from tax will cease to apply,” he said.

Mr Marende has questioned the move to tax MPs, citing Mr Wako’s letters. He also said the Kenya Revenue Authority and Finance ministry had written similar letters.