Money transfers, whether through MPESA, Internal Transfers, cheques, or Real Time Gross Settlement (RTGS), are the main channels through which we meet our customer’s needs - both at Nyali Capital Ltd and Ecobiz Sacco Ltd.
Midway 2018, the tax collector decided to tax our stocks at the focal point where we meet our customers. This happens before we reach our profit margins on the cash transactions.
In contrast, our value is obtained at the point when clients repay their loans. That is when we earn interest. It’s also where we get the time value of money.
Unfortunately, the tax man is impatient, and he does not care whether business people such as ourselves make money or not.
Today, it now does not matter how much money we transfer. This is because when the amount is less than Kshs. 100,000/-, cellular customs duty checks in with an additional cost for the transfer. “Where transfers are made through the bank, then any amount above Kshs. 500,000/- attracts a tax of 0.05% on top of the excise duty of 10% on the bank charges.”
These additional costs automatically increase our cost of doing business and eat into an interest that we haven’t even earned.Add a comment