Prime
Kenya to bring back some scrapped tax plans, risking more unrest
People attend a demonstration over police killings of people protesting against the imposition of tax hikes by the government, in Nairobi, Kenya, July 2, 2024. PHOTO/REUTERS
What you need to know:
- Some people who were involved in the youth-led protest movement that rocked the East African nation said they were ready to go back onto the streets after the minister's announcement
- After the bill was dropped, the government cut spending and widened the fiscal deficit.
Kenya's government will have to bring back some tax measures that it scrapped after deadly protests in June, the finance minister said, raising the risk of further unrest.
John Mbadi told Citizen TV in an interview broadcast on Sunday night that some of the measures would be tweaked and not all would be revived, but they were needed to pay for expenditure including wages for teachers.
Some people who were involved in the youth-led protest movement that rocked the East African nation said they were ready to go back onto the streets after the minister's announcement.
"I was going to take a one month break from social media... but it seems that there is no rest for me," Hanifa, who only uses one name, wrote on X.
"The struggle continues. @WilliamsRuto I dare you to bring back the finance bill," she added.
President William Ruto abandoned the finance bill for this fiscal year on June 26, and later dismissed most of his cabinet, bowing to pressure from protesters who had stormed parliamentand launched demonstrations across the country.
The bill had contained new taxes and hikes to raise an extra 346 billion shillings ($2.70 billion) - plans that the protesters said would pile pressure onto a population already struggling with surging living costs.
Mbadi, who was brought into the cabinet from the opposition benches as Ruto tried to prop up his government, had ruled out further tax hikes during his first public remarks in the post on Aug. 4.
In the interview on Sunday, he said the government planned to reintroduce what he called an eco-levy on most goods - though plans to tax essential products such as sanitary pads, which were a focal point for protesters' anger, would be dropped.
"For eco-levy, we would target those areas that do not affect the common citizen," he told the private broadcaster. The measures were needed to fund emerging government expenditures, and will be taken to parliament by Sept. 30, Mbadi said.
The government has been caught between the competing demands of hard-pressed citizens and of lenders such as the IMF, which is urging the government to cut deficits to obtain more financing.
After the bill was dropped, the government cut spending and widened the fiscal deficit.
Neither Mbadi, nor the finance ministry, responded to Reuters requests for comment on the interview.
The new moves would raise 150 billion shillings, Citizen TV reported. The minister rejected criticism of the levy by businesses operating in Kenya.
"This country is not a dumping place. If you are injurious to the environment, then you must pay to make good what you have caused," he said.
The government was working to bring back 49 clauses from the original bill, some meant to streamline laws without raising or introducing new taxes, Mbadi told the broadcaster.
