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Wednesday, November 25, 2020 – Employed Kenyans could soon feel the pain of unemployment after the Government of President Uhuru Kenyatta came up with a way to ‘rob’ the employed Kenyans to cushion the unemployed lot.

According to the proposal contained in the National Treasury post COVID-19 economic recovery strategy, Kenyans holding jobs could soon be obligated to pay a two percent tax from their incomes to cushion the unemployed in the next two years.

This will increase taxation for employed individuals who already account for a number of other statutory deductions such as NHIF and further indirect taxes.

Proceeds from the tax to be partly contributed by employers at the rate of one percent are expected to go into the soon to be set up unemployment insurance fund (UIF).

“The Government will establish a UIF to cushion workers in financial distress by providing them with short-term relief when they become unemployed, or are on unpaid leave or unable to work because of illness.”

“The amount of contribution to the fund with be two per cent which include one per cent paid by employees from remuneration paid and one per cent paid by the employers,” the National Treasury said.

The UIF is seen as part of the solution to Kenya’s endemic unemployment which has been worsened by the COVID-19 pandemic.


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