[kictanet] The burden of taxing ICTs

Thu Nov 13 11:03:20 EAT 2014

@ Ngigi,

Maybe historians like John Walubengo would tell as why and how Gilgil
Telecoms Industries was established as well as its successes and
failures, this is the only local industry i can think of that i
consider a success, any elders on the list to give us a background?

Regards

On 11/13/14, Ngigi Waithaka via kictanet <kictanet at lists.kictanet.or.ke> wrote:
> Ahmed,
>
> Dumping does not necessarily imply low quality.
>
> As an example if we open our Sugar importation markets and Zero Rate import
> duty on Sugar imports, it doesn't mean we will get low quality Sugar from
> Brazil/Egypt, but there is a chance in short order all the Sugar factories
> in our western belts will close shop in short order.
>
> The Huwaei Ideos is not a bad phone, but maybe its introduction to the
> market market signed the death warrant for the Gilgil phone manufacturing
> plant.
>
> So what we did is open up our technology importation to anyone who has
> anything to offer in ICT and I hope we don't get surprised that in 10-20
> years we wouldn't have any solid technology industry to talk about.
>
> Rgds
>
> On Thu, Nov 13, 2014 at 10:40 AM, Ahmed Mohamed Maawy via kictanet <
> kictanet at lists.kictanet.or.ke> wrote:
>
>> My 2 cents on the dumping ground issue:
>>
>>    1. It is more of an import workflow issue than it is a taxation issue.
>>    By import workflow this means that are we really evaluating if the
>> products
>>    that get to market have the quality assurance? For instance e-waste
>> control
>>    policy is a mechanism that has worked.
>>    2. So has it been a dumping ground for things that have revolutionized
>>    the market in positive ways. When Huawei IDEOS came in we were amongst
>> the
>>    first countries to benefit. More and more people started adopting
>> smart
>>    phones and connecting to the grid, which to me is a huge market space
>>    created for small to medium enterprise businesses to scale applications
>> and
>>    do more business. This was actually much better for the economy. And
>> let us
>>    admit it, that phone had and still has good quality feedback from
>> people
>>    who have bought it.
>>
>> Ahmed
>>
>> On Thu, Nov 13, 2014 at 10:33 AM, Barrack Otieno via kictanet <
>> kictanet at lists.kictanet.or.ke> wrote:
>>
>>> Where did the rain start beating us?, we used to manufacture phones at
>>> Gilgil Telecom Industries, what happened to e-Mado?, indeed we need to
>>> study the pros' and cons of taxation on the technology sector.
>>> Probably we need a deliberately structured approach of introducing and
>>> managing the tax regimes  to safeguard and nature the growth of the
>>> technology sector. The banking industry exploded when banking fees
>>> were reduced. One of the factors that made Mpesa Juicy was the low
>>> transaction costs compared to what banks were offering. Just drawing a
>>> laymans correlation.
>>>
>>> Best Regards
>>>
>>> On 11/13/14, Ngigi Waithaka via kictanet <kictanet at lists.kictanet.or.ke>
>>> wrote:
>>> > Listers,
>>> >
>>> > Taxation is *always* a double edged sword. In this instance, we would
>>> have
>>> > to ask ourself what is the *NET* effect we want to achieve with the
>>> > taxation?
>>> >
>>> > As an example, our current and previous tax have been to increase ICT
>>> > usage, at all costs. Lower the taxes and all the computers and
>>> > software
>>> > will become very cheap and affordable and ICT industry can take off.
>>> >
>>> > However, that in my view doesn't have the necessary depth.
>>> >
>>> > Take for example the local industry, every time you lower the taxes,
>>> > and
>>> > especially import taxes, you make it that much harder for your local
>>> > industry to grow as it immediately faces stiff competition from the
>>> global
>>> > players. Your market becomes the dumping ground for every
>>> > multi-national
>>> > who sell their products to your market cheap, and then immediately
>>> > take
>>> off
>>> > with all the profits without re-investing in the local economy.
>>> >
>>> > Taxation can and should address that.
>>> >
>>> > If you look at the policies of most of the developed nations, one
>>> > thing
>>> at
>>> > the center of their taxation policy is ensuring their local industries
>>> > thrive and force outsiders on the very least to consider moving their
>>> > manufacturing to their markets as that creates jobs and also leads to
>>> > knowledge transfer. A good example of this, it is not by chance that
>>> most
>>> > Japanese car manufacturers in the US have manufacturing plants in the
>>> US,
>>> > policy (including taxation) forces them to.
>>> >
>>> > Also it is not a coincidence that there are hardly any US cars bought
>>> > in
>>> > Japan (
>>> >
>>> http://americanautocouncil.org/sites/default/files/Japans%2BProtected%2BAuto%2BMarket.pdf
>>> > )
>>> >
>>> > Now, we could ask, what have our current taxation policies brought us:
>>> > 1. High consumer usage of ICT
>>> > 2. Non-Existent local high-technology sector (we wouldn't built our
>>> > own
>>> > Huwaei's, Motorolas, Samsungs as these multi-nationals are able to
>>> import
>>> > goods into our markets with almost no taxation, hence making it almost
>>> > impossible for a local to challenge them)
>>> > 3. Non - existent high technology export (if we do not have local
>>> > firms
>>> > that can build technology solutions, we have nothing to export)
>>> > 4. Engineers(Electronics, Electrical, Industrial Design) who have no
>>> places
>>> > to work since there are not enough local firms that could use their
>>> > core-services (and repairing broken fibre links is not what one spends
>>> > 5years learning electronics in campus to do)
>>> >
>>> > So we will remain a country of high ICT consumerism while being a
>>> > dwarf
>>> in
>>> > technology.
>>> >
>>> > Regards
>>> >
>>> > On Wed, Nov 12, 2014 at 5:36 AM, Ali Hussein via kictanet <
>>> > kictanet at lists.kictanet.or.ke> wrote:
>>> >
>>> >> Listers.
>>> >>
>>> >> Interesting article.
>>> >>
>>> >> KITOS, hope you are listening...
>>> >>
>>> >> Kenya has in the past few years showed promise of renewed innovative
>>> >> capacity, especially in the Information Communication Technology
>>> >> (ICT)
>>> >> sector.
>>> >>
>>> >> But the new tax regime precipitated by the East African Community
>>> >> (EAC)
>>> >> tax harmonisation is about to reverse all the gains we have made thus
>>> >> far.
>>> >>
>>> >> Read on
>>> >>
>>> >>
>>> >>
>>> http://www.nation.co.ke/oped/blogs/dot9/ndemo/-/2274486/2516562/-/1xv3f7z/-/index.html
>>> >> *Ali Hussein*
>>> >>
>>> >> +254 770 906375 / 0713 601113
>>> >>
>>> >> Twitter: @AliHKassim
>>> >>
>>> >> Skype: abu-jomo
>>> >>
>>> >> LinkedIn: http://ke.linkedin.com/in/alihkassim
>>> >> <http://ke.linkedin.com/in/alihkassim>
>>> >>
>>> >> Blog: www.alyhussein.com
>>> >>
>>> >> "I fear the day technology will surpass human interaction. The world
>>> will
>>> >> have a generation of idiots".  ~ Albert Einstein
>>> >>
>>> >> Sent from my iPad
>>> >>
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>>> >>
>>> >> The Kenya ICT Action Network (KICTANet) is a multi-stakeholder
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>>> >> for people and institutions interested and involved in ICT policy and
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>>> >> ICT
>>> >> sector in support of the national aim of ICT enabled growth and
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>>> >>
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>>> >
>>> >
>>> >
>>> > --
>>> > *Regards,*
>>> >
>>> > *Wait**haka Ngigi*
>>> > Chief Executive Officer | Alliance Technologies | MCK Nairobi Synod
>>> > Building
>>> > T + 254 (0) 20 2333 471 |Office Mobile: +254 786 28 28 28 | M + 254
>>> > 737
>>> 811
>>> > 000
>>> > www.at.co.ke
>>> >
>>>
>>>
>>> --
>>> Barrack O. Otieno
>>> +254721325277
>>> +254-20-2498789
>>> Skype: barrack.otieno
>>> http://www.otienobarrack.me.ke/
>>>
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>>>
>>> The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform
>>> for people and institutions interested and involved in ICT policy and
>>> regulation. The network aims to act as a catalyst for reform in the ICT
>>> sector in support of the national aim of ICT enabled growth and
>>> development.
>>>
>>> KICTANetiquette : Adhere to the same standards of acceptable behaviors
>>> online that you follow in real life: respect people's times and
>>> bandwidth,
>>> share knowledge, don't flame or abuse or personalize, respect privacy,
>>> do
>>> not spam, do not market your wares or qualifications.
>>>
>>
>>
>>
>> --
>> *Ahmed Maawy*
>> Executive Director - M-Power (CBO)
>> Shaper - Global Shapers
>> Ambassador - Open Knowledge
>> Director - Startup Grind Mombasa
>> Software Developer - Volo Broadband
>> (KE) +254 714 960 627
>> Skype: ultimateprogramer
>>
>> m-power.or.ke
>> www.globalshapers.org <http://globalshapers.org/>
>> www.okfn.org <http://okfn.org/>
>> startupgrind.com
>> www.volobroadband.com
>>
>> _______________________________________________
>> kictanet mailing list
>> kictanet at lists.kictanet.or.ke
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>>
>> Unsubscribe or change your options at
>> https://lists.kictanet.or.ke/mailman/options/kictanet/ngigi%40at.co.ke
>>
>> The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform
>> for people and institutions interested and involved in ICT policy and
>> regulation. The network aims to act as a catalyst for reform in the ICT
>> sector in support of the national aim of ICT enabled growth and
>> development.
>>
>> KICTANetiquette : Adhere to the same standards of acceptable behaviors
>> online that you follow in real life: respect people's times and
>> bandwidth,
>> share knowledge, don't flame or abuse or personalize, respect privacy, do
>> not spam, do not market your wares or qualifications.
>>
>
>
>
> --
> *Regards,*
>
> *Wait**haka Ngigi*
> Chief Executive Officer | Alliance Technologies | MCK Nairobi Synod
> Building
> T + 254 (0) 20 2333 471 |Office Mobile: +254 786 28 28 28 | M + 254 737 811
> 000
> www.at.co.ke
>

-- 
Barrack O. Otieno
+254721325277
+254-20-2498789
Skype: barrack.otieno
http://www.otienobarrack.me.ke/