Kenyan Bishops Slate Proposed Tax Hikes – OpEd

By Lisa Vives

In a lengthy statement, members of the Kenya Conference of Catholic Bishops are warning against passage of the 2024 finance bill, which if passed, they say, would hurt the vast majority of the country’s poor.

The bishops criticized the proposed slew of new taxes, calling them “punitive” because they would mostly affect the poorest people of Kenyan society.

“Given the current economic challenges, it is our opinion that the proposed punitive taxes are likely to devastate the economy and impoverish the majority of Kenyans,” the bishops said in a June 7 statement.

“We therefore urge the government to establish a tax regime that is predictable and conducive to economic growth, rather than one that stifles the private sector and overburdens the poor and vulnerable.”

The bill aims to broaden the tax base and boost state revenue in order to curb the country’s budget deficit. It would raise taxes on telephone and internet data services, as well as money transfer services, from 15 percent to 20 percent, reversing the previous year’s figure which lowered the tax.

In a stinging piece on TikTok, famed author and professor Ngugi Wa Thiong’o added his voice to denounce the controversial tax policies supported by Kenya’s current president, William Ruto – policies that are unpopular even with his supporters.

Ruto campaigned on a platform of reducing the cost of living. While seeking election, he accused former President Uhuru Kenyatta of letting food costs “skyrocket” for having come from a wealthy and politically powerful Kikuyu family.

Kenya’s Finance Minister Njuguna Ndung’u is expected to present the country’s biggest ever budget to Parliament alongside a controversial $31 billion finance bill that contains a raft of new or increased taxes.

“The budget today is going to emphasize the policies that we need to support a fragile economic recovery,” he told reporters.

Parliament has already approved the proposed spending plan, but the finance bill could lead to an acrimonious session.

Parting with about 40 percent of income

The new tax hikes will see some Kenyans part with about 40% of their income.

While there are valid concerns about the manner in which the government is using taxes to raise revenue, there are even greater concerns about how the money collected is managed.

The bishops also raised such worries, urging the government to tackle corruption head-on.

“It is regrettable that despite pleas to our leaders to implement measures to lower the cost of living and reduce suffering, a significant portion of tax revenues ends up in the pockets of a few well-connected individuals,” they said.

President Ruto claims the tax hikes are the only way to reduce borrowing for a government struggling with a public debt of $67 billion and classified by the World Bank as being at high risk of debt distress.

Kenya has one of the most dynamic economies in East Africa but about one third of the country’s 51.5 million people live in poverty.

Meanwhile, Kenyans in the Diaspora will be honoring East Africa’s leading novelist on June 22 at Georgia State University in Atlanta. Among his many written works are “Weep Not Child,” ‘Petals of Blood”, “Wizard of the Crow,” and “Decolonizing the Mind – the Politics of Language in African Literature.” The 86-year-old Ngugi has 84 books listed on Goodreads. His most popular book is “A Grain of Wheat.”