393 Nairobi County employees escape PAYE tax deductions

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Counties

393 Nairobi County employees escape PAYE tax deductions


City Hall

Nairobi City Hall. File | National Media Group

A total of 393 employees working for the Nairobi County Government earned a combined salary of Sh52.6 million in the financial year ending June 2023 without paying income tax as required by law, according to a new report.

Auditor General Nancy Gathungu’s report for the Nairobi City County Executive says the officers have not been defined in the category of persons with disabilities, who are entitled to tax exemption on any remuneration derived from their job.

“Analysis of the payroll revealed a total of 393 officers whose PAYE (Pay As You Earn) was not recovered from their salaries as required by the Income Tax Act,” the statement said. auditor in the report.

“Employees were not defined in the category of disabled people. The officers earned a total of Sh52.6 million from which no tax was recovered.

This revelation comes at a time when workers are suffocating under the weight of increased taxation as the government implements the 2023 finance law and proposes additional taxes and levies.

In his report, the auditor also pointed the finger at the county’s payroll after it emerged that three employees shared a common bank account during the period examined, highlighting a possible racket aimed at defrauding city hall coffers .

At the same time, the auditor’s report found that 252 employees earned a net income less than one-third of their base salary, contrary to the guidelines provided in the Human Resources Policies and Procedures Manual for the Public Service, 2016 , which provides that public employees must not overcommit their salaries beyond two-thirds of their base salary.

During the year, two officers were hired by the county on a permanent, pensionable basis despite having reached the age of 50, while four others were actively on the payroll but without salaries awarded.

The report said 178 officers received leave pay twice during the 12 months, totaling Sh15.4 million. Another 26 employees drawing gross monthly salary also received additional allowances such as housing supplement, rent and service gratuity totaling Sh17.6 million.

“Analysis of the payroll shows that 395 agents received salary arrears for a period of between seven and 12 months during the year under review. Additionally, 64 officers received arrears ranging between Sh300,000 and Sh6.8 million, totaling Sh82.3 million during the financial year. The nature of the allocations totaling Sh100.1 million could not be ascertained,” the auditor wrote.

The county has also been accused of failing to comply with the Americans with Disabilities Act of 2003, which requires that at least five percent of the total employee workforce be reserved for people with disabilities.

According to the auditor, examination of the payroll shows that only 167 employees out of 13,354 were placed in the special category, which represents 1.25 percent of the total workforce.

When it comes to ethnic makeup, the county failed the test yet again after the report found that as many as 5,368 staff members, representing 40 percent of all workers, were from one ethnic group, unlike the national cohesion and integration law of 2008.

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