Quote:
There are more than 70,000 Kenyans earning above 100K who pay taxes and work in the formal sector
Easy answers as to why this number is so low yet houses are coming up like weeds in far flung suburbs of Nairobi and the streets are clogged with gleaming vehicles.
1.
Payslip nation (loud and vocal as it is) is just a
very tiny chunk of the Kenyan economy. The Kenyan economy is dominated by corporates and the informal sector, which is
the largest in Africa.. It might be a bitter pill to swallow for payslip nation, but that ka-hawker, taking to his heels fleeing kanjo daily while selling cheap Chinese goods on Tom Mboya street from 5pm to midnight (after spending the whole morning farming at his mugunda) probably makes more than the average payslipper per month, tax-free to boot.
2.
One to ten person SME's earn a huge chunk of Kenyan income. The wise ones don't fritter away everything trying to pay themselves "high" salaries. They pump back earnings into organic growth.
3. A good number of
small passive investors also do not appear in the numbers because their income is taxed at source as dividends and/or interest and thus will not show up in the struggling PAYE rolls.
4.
Income and net worth are two different animals. I see some young corporates earning 500k+ per month doing PAYE thinking they are big shots,
renting in Lavington, sipping martinis at Urban eatery with their gleaming BMW's (on loans of course) parked outside, fly to Zanzibar and Dubai monthly, yet own a big juicy
zero. Contrast with some of the property site visits. Mama mboga types and sober young students with years worth of savings securing their future and getting ahead pole pole, a plot at a time.
5.
Corruption:sad but true in Kenya. Trickle down effect
down to the kept dogo dogo/ slay queen on the street. Let us pray and hope this will change in our lifetime.
6.
Foreign investors. No secret that Kenya is a magnet for the middle classes from not just Somalia, S.Sudan, Uganda, Rwanda and so on, but increasingly, Europe and China and other nations as well. Like the french mama who came with 25 million after selling her house in Paris. That 25m is not captured in the numbers. Unfortunately she got swindled proper and lost it all.
7.
Kenyan diaspora and diaspora returnees. Are huge investors hapo. Some toiled in New Jersey cleaning old white people's backsides for decades while you chekelead them, then came back to gently retire in comfort. Their savings also will not be captured in payslip nation statistics.
8.
Serial borrowers. Usual they belong to category 1 above (payslip nation). Cars, furniture, even the shirt on their back is on loans. In Texas they say big hat, no cattle. Nuff sed.
8.
Other factors beyond the scope of this post