On 18th March 2020, the Federation of Kenya Employers participated in a tripartite meeting with the Ministry of Labour and Social Protection and other stakeholders to agree on measures of cushioning businesses in Kenya. In the meeting the Federation presented the following proposals that will help cushion companies and workers in dealing with this crisis situation facing nations worldwide.
Supply of basic essentials
To contain inflation and panic among the populace, FKE called upon the government to put in place measures that will ensure uninterrupted supply of basic food commodities like maize, beans, rice, wheat flour, green grams(ndengu), lentils e.t.c to all parts of Kenya.
FKE further asked the Government to incorporate a mechanism that will ensure steady, adequate and uninterrupted supply of fuel including cooking gas and the supply of necessary drugs and other medical/public health supplies that will be in high demand as the Country deals with the challenge posed.
In furtherance of the Government of Kenya’s (GoK) directive to reduce public transport occupancy, FKE requested GoK to subsidize the cost of fuel by 40% for an initial period of three months to cushion Kenyans from the adverse high costs of public transport
The Federation called for zero-rating of the PAYE tax for the next six months to ensure workers have more disposable income to meet the emerging challenges caused by the pandemic. Additionally, that Government considers zero-rating VAT for manufacturers of sanitation products like masks and sanitizers.To mitigate employers in the tourism industry, Government to consider zero- rating or suspending the 2% tourism levy on the gross revenue and to grant a rebate to those who had already paid the said levy.
Installment Tax and the Balance of Tax
Employers requested for the suspension of the payment of the balance of tax by three months and subsequently suspend the balance of tax that falls due in June 2020 for the same period. In the same breadth, that government effects waiver of late payments or late filling penalties of stamp duty and statutory filings among others
Nyumba Kumi initiatives
The Federation equally called for the activation of the National Administration machinery to coordinate sensitization of citizens on the basic guidelines on the spread of the virus. The administration would be crucial in enforcing some of the rules like mandatory hand washing in key areas. The government was also asked to step up the Nyumba Kumi initiative to monitor and gather information on movements of persons especially in high risk prone areas.
Special Crisis Fund
Finally, the Federation of Kenya Employers called on the Government to support businesses, especially MSMEs and SMEs through a Special Fund. These funds would support, subsidize the payment of salaries for employees for an initial period of 3 months.
The Federation of Kenya employers will continue to engage with the Ministry of Labour and other social partners to address the effect of the pandemic on employers and Kenya’s economy.