Azimio warns of more tax, rejects budget policy

Azimio la Umoja co-Principals Kalonzo Musyoka, Mwangi wa Iria, Eugene Wamalwa and former Laikipia Governor Nderitu Murithi during a presser at Jaramogi Oginga Odinga Foundation where they showed their displeasure with the tax regime that continue to hurt Kenyans. [Denish Ochieng, Standard]

Azimio la Umoja One Kenya has told Kenyans to prepare for a fresh round of taxes even as they voiced their dissatisfaction with the 2023 budget policy statement (BPS).

The Azimio principals led by Wiper Party boss Kalonzo Musyoka, said the 2024 budget policy statement, is only meant to prolong the suffering of Kenyans and would amount to double taxation.

"Our position is that the economic proposals, policies and strategies remain flawed and unachievable. As we have always said, this regime is completely irredeemable,’’ Kalonzo said.

But, while speaking at Jaramogi Oginga Odinga Foundation in Nairobi yesterday, the Azimio leaders ruled out the resumption of street protests over the increased taxation arguing that Kenyans had done their part.

"Kenyans went on the streets as a result of which the National Dialogue Committee was formed and the report is currently in Parliament. What else can we ask Kenyans to do other than tell them we have done enough? But if they don’t listen, there will be consequences because Kenyans must demand their rights,’’ Kalonzo said.

From the policy statement, the coming fiscal year will be marked by heightened intensity given the government's motivation to collect additional revenues through tax policies.

Azimio claimed the budget policy showed that taxation will increase by Sh324 billion between the current and the next financial year, which begs the question of where the extra billions will come from.

"Kenyans must be ready to tighten their belts because KK regime is coming after them in a second wave of taxes. We commit to reject any further taxation by this regime,’’ said Kalonzo.

He added: "To ordinary Kenyans, the Mama mboga, Boda-Boda riders and people of Mjengo, the regime is coming again with a double taxation plan, approximately Sh27,000 as tax per adult Kenyan."

Kalonzo spoke after chairing the Azimio Summit, attended by National Assembly Minority leader Opiyo Wandayi, DAP-K leader Eugene Wamalwa, former presidential candidate George Wajackoya, former governors Mwangi Wa Iria (Murang'a) and Ndiritu Muriithi (Laikipia).

According to the 2024 Budget Policy Statement, the government aims to boost revenue collection to over 20 per cent of the GDP in the next fiscal year. It also targets collecting Sh2,95 trillion in taxes, up from the 2023/24 Sh2,62 trillion revenue collection target.

This ambitious plan will rely heavily on the implementation of the Finance Act, 2023 (Act), together with recently launched policy instruments, for example, the National Tax Policy and the Medium-Term Revenue Strategy FY 2023/24-2026/27 (MTRS).

The National Tax Policy articulates broad guidelines to guide tax administration on the other hand the MTRS outlines the specific reforms that will boost revenue collection during the strategy period.

Some of the taxes include the introduction of Value Added Tax (VAT) on education and insurance services, an added introduction of motor vehicle circulation tax payable annually by vehicle owners, and a review on excise tax regime for alcoholic beverages to base taxation on alcoholic content.

"VAT on educational services means an increase in school fees. As a coalition party, we believe Kenyans will thrive when we cut, not when we increase taxes. We believe the country will thrive when the regime moderates its expenditure, reduces wastages and adopts a rights, and zero-based budgeting approach,’’ Kalonzo said.

With the shilling weakening against the dollar, the coalition issued a stern warning to Kenyans not to be excited about the artificial stabilisation of the currency by the Kenya Kwanza government.

"The shilling has lost its value against the US dollar. The shilling lost its value against Tanzania and Uganda shilling. The fall and instability of the shilling comes with a great price that includes escalated cost of imports including food,’’ he said.

Further, they continued with their critique of the governments' appetite for borrowing ignoring the warnings that the country is in debt distress and at the risk of debt default.