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Empty Wallets
Kenya's #1 newsletter among business leaders & policy makers
Hello there 👋🏿
It's Brian from The Kenyan Wall Street.
In today's edition of ‘The Daily Brief’, we inquire what is happening to Kenya's consumer spending power…
Also, Banks Lobby CBK to cut Interest Rates further…
And here is why the taxman believes auction sales to recover bad debt are still subject to VAT…
ECONOMY
Falling spending power
Shopping cart with items
Majority of Kenyans’ incomes stagnated or dipped last year, affecting consumer habits across most sectors, the quarterly Consumer Spending Index by ICEA Lion Asset Management shows.
61% of respondents indicated their income levels ended 2024 at the same level as 2023, 24% ended the year with lower incomes, and only 15% reported increased incomes.
Only the 26 – 35 years age group had a high proportion of individuals spending more while all other age groups reported lower spending trends. 60% of retailers surveyed reported an increase in sales compared to the final quarter in 2023, while approximately 40% had lower sales as individual spending trends remained largely unchanged.
Fred Obura analyzes the report in this article >>>>>
Today's Poll
How can you describe your purchasing power over the last one year? |
Yesterday's Poll Results
Do you think commercial banks should reduce interest rates further in line with the CBK's rate cuts?
🟩🟩🟩🟩🟩🟩 Yes (89.47%)
⬜️⬜️⬜️⬜️⬜️⬜️ No (10.53%)
FINANCE
More Interest Rate Cuts please…
Interest rates banks
Bankers have urged the Central Bank of Kenya (CBK) to cut interest rates further to stimulate private sector credit growth and economic activity, ahead of the CBK’s Monetary Policy Committee’s next meeting on February 5th.
The Kenya Bankers Association (KBA) argues that a further decline in rates would stimulate credit growth while resolving credit market challenges including pending bills.
According to the lobby group, the elevated non-performing loans ratio has dampened the pace at which banks are cutting rates on loans. The banking lobby group expects the monetary easing stance to be underpinned by the easing inflation anchored within CBK’s target bands, the shilling’s stability and slower economic growth.
Zainab Hafsah expounds more in this article >>>>
🗞️ Also by Zainab
Auction Sales Are Not VAT-Exempt - Tax Tribunal
Taxes
The Tax Appeals Tribunal (TAT) has determined that auction sales for debt recovery are not exempted from VAT, in a landmark case between Kenya Commercial Bank (KCB) and KRA.
The lender had sought legal redress after the tax man hounded the bank for non-payment of VAT for commercial vehicles sold in auctions between 2018 and 2022. It argued that the sale of auctioned items was not intended to garner profit but was an attempt to recoup defaulted credit. KRA argued that the bank was co-registered in the vehicles’ titles with the loans and sold them to third-parties, adding that such a supply was considered taxable under the VAT act.
TKWS Profiles
The Adaptis Group’s Chair Justus Kirigua on Leadership, Innovation, and Africa’s Future
Adaptis Group Chair, Justus Kirigua
In this interview, The Kenyan Wall Street talks to Justus Kirigua shortly after his appointment as the Advisory Board Chair of The Adaptis Group, on his plans for his new role, leadership, and the business potential in Africa.
✒️ On the News Desk
▶️ Video of the Day
In this episode of Her Leadership, we sit down with Nancy Masila, Founder & CEO of Jasiri Network, as she shares her incredible journey from Kenya to London as a young professional.
When it comes to money, ignorance is NOT bliss. What you don't know CAN hurt you.
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Have a lovely evening!