An out-of-favour Ruto side struggles to justify new taxes

Kikuyu MP Kimani Ichung’wah. He says the high taxes are necessary to ensure the growth of the manufacturing sector. [File, Standard]

In what promises to be a mettlesome two-day face-off pitting an out-of-favour President William Ruto’s side and the opposition, the National Assembly yesterday began the debate of the controversial Finance Bill 2024.

Lawmakers drawn from either side of the political divide made their case as to why they were either for or against the Bill ahead of the voting exercise to be carried out later today.

During the heated debate, Kenya Kwanza Alliance allied MPs moved to defend the punitive tax proposals introduced through the Bill while their minority side counterparts backed calls by the public to reject the Finance Bill in its entirety.

Leader of the minority in the National Assembly Opiyo Wandayi put across the case that the concessions by Ruto were not enough and that more punitive clauses had been retained in the Bill. He sought to have the government withdraw the Bill.

“What is so unique with this government that for two years in a row, the matter of Finance Bill is causing hullabaloo, it is commotion, it is causing pandemonium until young children are coming out of streets,” submitted Wandayi.

Adding: “I have read the Bill in its entirety, I have similarly read the report of the Committee. If you look at the report of the Committee together with the amendments it is proposing to make to the Bill, then you come to the conclusion that actually the character, the structure of the Bill is actually changing fundamentally”

“At some point perhaps, I would be calling upon you, the Speaker to consider asking the Chair to withdraw the Bill and introduce a new one. Because the character is changing.”

National Assembly’s Minority Whip Junet Mohammed warned that an adaption of the Bill as currently constituted would only further burden Kenyans. “How many times are we going to change the process of taxation in this country? We are discussing economic growth. Do you want to tell me this kind of Bill will enhance economic growth in this country?”

Rarieda MP Otiende Amollo claimed that the Bill does not protect Kenyans and is not in their interests.

“I have myself recorded 120 reasons for rejection of this Bill. It is sufficient that the professional associations have spoken to this, the church has spoken to this, civil society has spoken to this and Kenyans have spoken to this,” said Amollo.

“It is important to understand that a budget is made for the people and traditionally, it is the people who must be listened to. We have a draft Bill whose origins is essentially the Bretton Woods Institutions; IMF and World Bank. These institutions were never made to further the interests of developing countries,” he added.

The legislator also poured cold water on claims by a section of the Kenya Kwanza MPs that if the Finance Bill is rejected, then the country would be in a crisis.

“We will not be in any crisis. Like last year, when the High Court stayed the 2023 Bill, the 2022 Bill continued until finally the Bill was cleared,” said the legislator.

Mombasa Woman representative Zamzam Mohammed claimed that the inclusion of the taxes on bread, cars and edible oils by the government and the subsequent proposal for their scrapping was part of a ploy by the Ruto administration to distract them from the “big devil” that is new taxes that have been left in the Finance Bill.

Kathiani MP Robert Mbui also expressed his displeasure with the Bill noting, “We were told to tighten our belts and as we tighten our belts, it is shocking to see the excesses that this government is going through. We are taxing Kenyans to raise money to run the government and yet we have excesses. We are putting money to repair houses that were built with Sh400 million and we are spending Sh600 million to renovate and paint. It is very painful.”

However, the Kenya Kwanza MPs held onto their convictions and painstakingly tried to justify the taxes contained in the Bill. Daringly, the leader of majority Kimani Ichungw’ah said that the high taxes were necessary to ensure growth of our manufacturing sector.

“What is so wrong with us protecting our manufacturing sector in this country. What is so wrong with us ensuring we are creating jobs within our economy instead of creating jobs in other countries? Because when we say that we do not levy excise duty on imported finished products, whether they are finished and fully assembled boda bodas, we are creating and exporting jobs out of this country into those economies where we want to import those finished products from,” he asserted.

“When then we are told that imposing excise duty, an eco-levy, imposing VAT on imported finished products in order to protect our manufacturing industry, in order to ensure that we have jobs being created for the thousands of youth who today are being misled that the only thing that these members can do it is to reject this Finance Bill, instead of fixing it,” he added.

His Deputy, Kilifi MP Owen Baya, called on the legislators to support the Bill to ensure they got access to an increased Constituency Development Fund allocation.