Kenyans to Pay More in NSSF Deductions As President Ruto Aims at Increasing Savings Rate

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Kenyans could face increased mandatory deductions after President William Ruto promised to hike the country’s savings rate.

The Head of State who spoke at the Annual Summit of the Africa CEO forum revealed the government’s plan to double the country’s 60-year savings within 4 years.

According to Ruto, for the past 60 years, Kenyans saved a total of KES 320 billion through NSSF, with the head of state revealing he would increase the amount to KES 640 billion.

The President noted Kenya had one of the lowest savings rates globally and it was time to make changes to match the country’s peers whose savings rates were way better.

Ruto while explaining his stance revealed that Kenya’s savings as a percentage of the GDP stood at 10 per cent with Ruto claiming it was one of the lowest historically.

“Kenya’s saving as a per cent of GDP is at 10 to 11 per cent, other regions are at around 40 and 50 per cent and that of China is at 55 per cent,” Ruto revealed.

Ruto while insisting on the matter, revealed that the initial Ksh200 contributed by Kenyans to the National Social Security Fund was retrogressive and thus needed to be changed.

“We were saving Ksh200 every month for every Kenyan in our NSSF and I said we must change this we changed it and now every Kenyan pays 6 per cent of their salary and every employer pays 6 per cent of the equivalent,” the head of state explained.

The move comes barely three days after the President announced the government’s intention to impose more taxes on Kenyans to help the country get out of debt distress.

The Head of State made the pronouncement during a meeting with Harvard University students at the State House in Nairobi where he affirmed his commitment to financial sustainability by avoiding loans.

“I am not going to preside over a bankrupt country, I am not going to preside over a country that is in debt distress. We have to cut our spending,” Ruto declared.

“Kenyans have been socialized to believe they pay a lot of taxes, but empirical data shows that Kenya last year our tax was at 14 per cent,” he added.