EXPLAINER: FINANCE BILL 2024 CHAOS. HOW DID KENYA GET HERE?
What is going on?
Kenyans are protesting a controversial finance bill that seeks to tax essential commodities amid a slow economy. The bill also allows the revenue authority to monitor the citizens’ financial records.
What are the demands?
The #OccupyParliament protesters are demanding that MPs reject the finance bill in its entirety and draft a new one. They are threatening to paralyse business across the country if the legislators dare pass the bill.
What does Kenya’s burgeoning debt have to do with it?
Kenya is in a liquidity crisis. Its total debt repayment stands at 58.8% of government revenue. This leaves little for development & social services. Consequently, the State has turned to more taxes to plug the deficit.
What is IMF’s hand in the debate?
The International Monetary Fund (IMF) has been pushing the Government of Kenya to implement strict austerity measures. Ordinarily, such measures come with increased taxes. Kenyans have rejected some taxes proposed in the #FinanceBill2024.
Why are Gen Zs leading the protests?
Often dismissed as unconcerned about civic issues, Kenyan Gen Zs are shrugging off the misconception. They are the new face of protests. The anger started on TikTok about the unpopular bill before quickly exploding into nationwide protests.
What is the Government saying?
President William Ruto says the Finance Bill proposals will be amended and the punitive taxes proposed revised. However, MPs affiliated with the government vow to pass the Finance Bill. They warn that dropping the taxes will affect the Budget 2024/25.
What exactly was removed from the Finance Bill?
1. VAT on Bread, transportation of sugar, financial services & forex transactions dropped
2. Motor Vehicle Tax withdrawn
3. Locally manufactured sanitary pads & diapers exempted from Eco Levy
4. KRA access to taxpayers’ data suspended
What are others saying?
The African Commission on Human and Peoples’ Rights, says the Finance Bill 2024 will affect the basic human needs of Kenyans. The Commission has urged the government to review the proposals and refrain from violating the rights of protestors at the #RejectFinanceBill2024 demos.
Is there a way forward for Kenyans?
Kenya's debt situation is a ticking time bomb, says Amos Wemanya adding that the state of financial uncertainty is a consequence of overborrowing. ‘‘The country’s debt needs to be audited and odious debts cancelled to relieve Kenyans from heavy repayment obligations. This will return the people’s fiscal freedom.’’