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Rank: Elder Joined: 7/22/2009 Posts: 7,460
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sparkly wrote:MaichBlack wrote:@Elephant Man - I totally agree with you and you raise a very important point. Broker charges are known (fixed at certain publicly available rates) and should therefore automatically be deducted from any gains before applying CGT. Ignoring them will be pure robbery!!!
If I buy shares at 100k and sell them at 103k, KRA should not PRETEND that the 3k is my gain. They know VERY WELL it all went brokers.
Is KRA going to factor in broker charges? I'm not sure. This CGT is full of unanswered questions!!! How many of those questions have been answered in the last couple of weeks wazuans in the know can tell us. The broker calculates and pays the tax on your behalf. I see a challenge where shares are transferred to another broker. He will not know how much they cost you in the first place so you might be required to provide the info. This information should then be transferred with you shares. But in my opinion CGT - especially on shares - is pure robbery if you ask me! Triple taxation!!! I buy into a company. We make a handsome profit. You tax it. We decide to share a bit of what you left us with (dividends) you tax us again (withholding tax). I decide to sell my shares which are now at a higher price because of the good performance (from which you've already taxed me twice) and you tax me again!!!! Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Elder Joined: 7/22/2009 Posts: 7,460
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The economy grows when we put more money in the hands of the citizens not the government. I said this devolved system of government is bloated, will not be any more efficient, will devolve corruption, will be very expensive leading to more taxation, will institutionalize tribalism etc. etc. and some people dismissed me. Here we are now!!! I will celebrate the day we abolish county governments or reduce them to a maximum of 8!!! And it will happen. I can't be paying for inefficiencies, devolved corruption, duplicated roles at County and National governments etc. And now after using what we gave them building/buying over priced residences, curtains, cars, trips etc., the governors now want higher budgetary allocations. Guess where the money will come from!!! Hint: Njiraini will be involved. And you will be an unwilling participant. Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Elder Joined: 7/22/2009 Posts: 7,460
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Note: I know some people look at devolution using their tribal/political/regional goggles. I look at it from a services/efficiency/cost - benefit/development angle. That is why these comments are not in ClubSK. Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Veteran Joined: 11/15/2013 Posts: 1,977 Location: Here
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MaichBlack wrote:The economy grows when we put more money in the hands of the citizens not the government.
I said this devolved system of government is bloated, will not be any more efficient, will devolve corruption, will be very expensive leading to more taxation, will institutionalize tribalism etc. etc. and some people dismissed me. Here we are now!!!
I will celebrate the day we abolish county governments or reduce them to a maximum of 8!!! And it will happen. I can't be paying for inefficiencies, devolved corruption, duplicated roles at County and National governments etc. And now after using what we gave them building/buying over priced residences, curtains, cars, trips etc., the governors now want higher budgetary allocations. Guess where the money will come from!!! Hint: Njiraini will be involved. And you will be an unwilling participant.  we need no more than 10 counties...there is a lot of duplication and wastage of resources. much as dvlpmnt has been seen in some areas,county gvts have too much than they can handle. Everybody STEALS, a THIEF is one who's CAUGHT stealing something of LITTLE VALUE. !!!
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Rank: Chief Joined: 1/3/2007 Posts: 18,121 Location: Nairobi
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MaichBlack wrote:The economy grows when we put more money in the hands of the citizens not the government.
I said this devolved system of government is bloated, will not be any more efficient, will devolve corruption, will be very expensive leading to more taxation, will institutionalize tribalism etc. etc. and some people dismissed me. Here we are now!!!
I will celebrate the day we abolish county governments or reduce them to a maximum of 8!!! And it will happen. I can't be paying for inefficiencies, devolved corruption, duplicated roles at County and National governments etc. And now after using what we gave them building/buying over priced residences, curtains, cars, trips etc., the governors now want higher budgetary allocations. Guess where the money will come from!!! Hint: Njiraini will be involved. And you will be an unwilling participant. AMEN. Lakini, most Kenyans do NOT understand this... they look at counties as TRIBAL/CLAN fiefdoms. This is why we have 47 units with mini-presidents instead of 8 counties encompassing various ethnic groups with a much more diverse economy. Some counties will rely mostly on mining royalties (think Nigeria's oil-producing states) instead of multiple streams of income. The USA should have been our model. It has 50 states [but it is a much larger country] which encompass MULTIPLE significant economic activities. Even Texas doesn't rely on oil as much as many think. They have farming, high-tech industries, logistics services, etc. We are going to muddle along for decades because of the tribal fiefdoms. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Chief Joined: 1/3/2007 Posts: 18,121 Location: Nairobi
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MaichBlack wrote:sparkly wrote:MaichBlack wrote:@Elephant Man - I totally agree with you and you raise a very important point. Broker charges are known (fixed at certain publicly available rates) and should therefore automatically be deducted from any gains before applying CGT. Ignoring them will be pure robbery!!!
If I buy shares at 100k and sell them at 103k, KRA should not PRETEND that the 3k is my gain. They know VERY WELL it all went brokers.
Is KRA going to factor in broker charges? I'm not sure. This CGT is full of unanswered questions!!! How many of those questions have been answered in the last couple of weeks wazuans in the know can tell us. The broker calculates and pays the tax on your behalf. I see a challenge where shares are transferred to another broker. He will not know how much they cost you in the first place so you might be required to provide the info. This information should then be transferred with you shares. But in my opinion CGT - especially on shares - is pure robbery if you ask me! Triple taxation!!! I buy into a company. We make a handsome profit. You tax it. We decide to share a bit of what you left us with (dividends) you tax us again (withholding tax). I decide to sell my shares which are now at a higher price because of the good performance (from which you've already taxed me twice) and you tax me again!!!! Quadruple Taxation. Tax 1 - VAT, Excise, etc that are non-recoverable Tax 2 - On Income Tax 3 - On dividends or Interest e.g. T-Bills (Tax on Financial Income) Tax 4 - Capital Gains Some may say Tax 3 & 4 are the same. Yes and No. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Veteran Joined: 8/16/2009 Posts: 994
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And going into next income tax rates revision expected next year, I see KRA introducing a new tax band of 40% to those earning about 100K. Things can only get worse. Problems come from fact that KRA is too lazy to follow the informal sector including landlords. Their only target is the formal economy. Time is money, so money is time. Money saved is time gained in reverse! Money stores your life’s energy. You expend your energy, get paid money, and store that money for a future purchase made in a currency.
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Rank: Elder Joined: 7/22/2009 Posts: 7,460
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Gatheuzi wrote:And going into next income tax rates revision expected next year, I see KRA introducing a new tax band of 40% to those earning about 100K.
Highly unlikely. Actually at one point the idea was to revise the tax bracket to reflect the inflation since the last time it was revised (As any 'common sense' country would do) to reduce the income tax burden on Kenyans. That was somehow shelved. I'm sure the bloated system had something to do with it. More money is needed. Increasing income tax however would be a suicide mission for the Jubilee government. You don't take food out of someone's mouth and it ends nicely. And unlike CGT this would cover quite a good number of voters. And Uhuru had at one point said there is no need to increase the tax burden on Kenyans (I'm not sure if it was before or after CGT). Of course they have increased taxes here and there - more commodities subject to VAT including power, CGT etc. but I believe income tax would be the red line not to cross! Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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