Raila rejects Finance Bill 2024 in totality, warns economy may collapse
![Raila rejects Finance Bill 2024 in totality, warns economy may collapse Raila rejects Finance Bill 2024 in totality, warns economy may collapse](https://citizentv.obs.af-south-1.myhuaweicloud.com/126034/conversions/Raila-og_image.webp)
Opposition leader Raila Odinga addresses the press during a joint briefing with Prime CS Musalia Mudavadi on June 5, 2024. PHOTO | COURTESY
The Azimio la Umoja One Kenya coalition party
leader Raila Odinga has slammed the government over the proposals contained in Finance
Bill, 2024.
In
a statement on Friday, Mr. Odinga took a swipe at the Kenya Kwanza regime terming
the Bill as retrogressive and insensitive to the plight of the poor in the
country, reiterating that its impacts will be worse than Finance Bill, 2023.
The
opposition leader cited the economic areas which would be affected by the
proposed increase of taxes and Value Added Tax (VAT) saying ordinary Kenyans will
be subjected to hardships worse than in the last financial year.
“The
Bill is a regressive taxation proposal that goes ruthlessly after the poor.
Should it be ratified, low-income people will be hit with taxes on multiple
fronts and will end up paying more than people with higher incomes. It is
obvious that tax on basic necessities such as food, cooking oil and money
transfer disproportionately hurt the poorest of the poor,” he said.
“The
tax burden in Kenya is at its highest level since independence, but public
services have largely remained on their knees. As if this is not bad enough the
Finance Bill 2024 proposes even more and higher taxes. Consequently, the people
and the country will be way worse off at this time in 2025 if the Finance Bill
2024 does not undergo a radical surgery. Most of the tax proposals in the
Finance Bill 2024 are as insensitive as they are callous.”
Mr. Odinga highlighted the new taxes imposed
on basic commodities such as bread, edible oil, mobile banking transactions and
sugarcane factories reaffirming that the same would subject Kenyans who are
already hurting economically to more pain.
He
also touched on the negative impact of the eco levy which is proposed to be
imposed on manufactured products such as diapers, the 2.5 per cent tax on motor
vehicles and new taxes on insurance and reinsurance services.
“The
government is trying to make it more costly for people to send and receive
money by phone and at the same time trying to kill remittances from the
diaspora…When the government imposes a 25 per cent excise duty on edible oil as
is being proposed in the Finance Bill 2024, the cost of cooked food, including
those served in kibandas and kiosks that are the refuge of millions of casual
workers will rise,” he stated.
“We
see no positive result that the country which is a net importer of nearly
everything can derive from the proposal to raise import declaration fees from 2
per cent to 3 per cent. The impact is that the cost of goods will go up.”
According
to the Azimio boss, the President William Ruto-led regime ought to learn from Finance
Bill, 2023 which he says despite slapping Kenyans with more taxes in the name
of raising the country’s revenues, the Kenya Revenue Authority (KRA) still fell
short of its targets.
He
argues that the revenues decreased since most businesses were forced to shut
down due to high operation costs resulting from high prices of fuel.
“It
must be remembered that the tax measures put in place last year and which led
to violent protests have subjected Kenyans to a great deal of trauma but bore
no fruit. The intended purpose of the 2023 tax measures was to help the
government raise more revenue,” he said.
“Instead,
the Kenya Revenue Authority consistently failed to meet targets. The high taxes
on petroleum products occasioned a fall on the fuel levy raised. They led to
closure and relocation of businesses.”
Mr.
Odinga thus advised the current administration to reconsider its tax proposals
warning that Finance Bill, 2024 may lead to the collapse of the country’s
economy.
He
consequently implored Members of Parliament to shoot down the Bill when it is
tabled in Parliament in a bid to save Kenyans.
“If
we expect businesses to invest in Kenya, then we cannot afford a tax policy to
shoot up and down and keep swinging like a pendulum. We equally cannot afford
taxation measures whose end result is to inflict more pain on the poor who
expect relief… The tax proposals for 2024 will make an already bad situation
worse. They could usher the collapse of an economy that is already severely
suffocated and the poor will be the hardest hit,” he noted.
“Parliament
must therefore inject very radical surgery on the outrageous proposals in the
Finance Bill 2024. We will not accept the mistakes and pains inflicted on
Kenyans by the Finance Act 2023 to be continued into 2025 through Finance Bill
2024.”
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