CIVIL SOCIETY ORGANIZATIONS CONDEMN KENYA'S FINANCE BILL 2024, CITE RISING COSTS AND UNFAIR TAX POLICIES.

BY NJOKI KARANJA 

A coalition of civil society organizations under the Okoa Uchumi Campaign has strongly criticized the government's proposed Finance Bill 2024, warning that the rising taxes and budget cuts in critical sectors pose a severe threat to the wellbeing of Kenyan citizens. 

The coalition, which includes partners and citizens dedicated to public participation and social accountability, expressed profound concern over the escalating cost of living and what they describe as punitive, unattainable, and unpredictable tax policies. 

Major Budget Cuts in Essential Sectors

The Finance Bill 2024 proposes significant budget reductions averaging 11% in key areas such as education, research, social protection, disaster response, and agriculture. Meanwhile, certain Ministries, Departments, and Agencies (MDAs) within the executive are experiencing budget expansions. The coalition argues that this imbalance jeopardizes citizens' well-being and undermines the government's duty to prioritize essential services that uphold the dignity and prosperity of all individuals.

Tokenistic Public Participation

The coalition also criticized the government's public participation process, describing it as tokenistic, meaningless, and exclusive. Despite being invited to give their opinions, citizens' voices are not reflected in the final policies approved by parliament. The Finance Committee, led by Hon. Kuria, reportedly rejected over 63% of citizens' views on the Finance Act 2023. The coalition calls for a more inclusive and meaningful public participation framework.

Unfair Tax Proposals

The Finance Bill 2024 introduces several controversial tax proposals, including:

1. Privacy Violations: 

Exempting the Kenya Revenue Authority (KRA) from the constraints of the Data Protection Act, allowing access to taxpayers’ data and potentially leading to persecution.

2. Increased Costs on Basic Goods:

 Removing VAT zero-rating on essential items like bread and milk, likely increasing their costs and violating the right to food.

3. Regressive Vehicle Tax:

 Imposing a 2.5% tax on motor vehicles, disproportionately affecting lower-income citizens.

4. Penalties for Small Businesses:

Requiring eTIMS integration with severe penalties for non-compliance, mainly targeting small businesses.

5. Increased Import Fees and Excise on Data Services:

Raising the import declaration fee from 2.5% to 3% and increasing excise on telephone and internet data services, potentially hindering access to education and communication.

Call for Accountability and Alternative Measures

The Okoa Uchumi Campaign emphasizes that the government's focus on increasing the tax burden is not matched by efforts to combat revenue leakages through corruption, wastage, illicit trade, and money laundering. With Kenya losing approximately Ksh. 608 billion annually to corruption, the coalition asserts that continued taxation without accountability amounts to extortion.

The coalition urges Members of Parliament to reject the Finance Bill's unfair tax proposals and calls for alternative revenue collection measures that do not overburden citizens and businesses. They also demand greater accountability and compliance with existing taxes.

Mobilizing Citizen Action

Okoa Uchumi plans to continue amplifying citizens' proposals submitted to parliament and mobilize Kenyans to inform their MPs about their stance on the Finance Bill 2024. The coalition seeks a more accountable government that prioritizes the welfare of ordinary Kenyan taxpayers.