The middle class is facing a significant financial burden due to recent tax increases. With the introduction of the Social Health Insurance Fund (SHIF), workers are now losing up to 40% of their income to taxes and statutory deductions. This includes SHIF, Paye, NSSF, and housing tax.
For instance, a Kenyan earning Sh500,000 will have Sh161,957 deducted, a substantial increase from previous years. The SHIF alone accounts for Sh13,750 of this deduction.
While the government aims to improve healthcare access, concerns have been raised about the value for money. The SHIF's benefits package, including allocations for eyeglasses and outpatient services, is seen as inadequate compared to private insurance.
Union leaders and health experts are critical of the government's approach, arguing that it is overzealous in taxing the middle class while failing to deliver quality healthcare services. They are calling for increased wages and a review of the SHIF's design and implementation.
As workers struggle to cope with the financial strain, questions remain about the long-term impact of these tax increases and the effectiveness of the SHIF in improving healthcare outcomes for Kenyans.
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