Calls for Fiscal Changes to Ease Kenyan Economic Challenges
In a recent address, Azimio La Umoja One Kenya Party leader Raila Odinga challenged President William Ruto to explore alternative means of revenue generation for national development, asserting that taxing Kenyans is not a sustainable solution. Odinga accused President Ruto of burdening the citizens with excessive taxes, exacerbating the already high cost of living. He emphasized the need for the government to focus on creating job opportunities and revitalizing initiatives like Kazi kwa Vijana and Kazi Mtaani to stimulate economic circulation.
Odinga launched a party registration drive on Monday to counter the growing influence of the UDA party in his Nyanza stronghold. During the event, he voiced concerns over the escalating taxation and urged the government to halt further increases. The Opposition leader highlighted the impact of taxation on basic commodities, rendering many families unable to meet their daily needs.
In a strategic move, Odinga proposed a comprehensive audit of procurement officers within government ministries, asserting that this measure could reveal revenue-generating opportunities and enhance economic growth. Drawing from his past experience in government, he explained how a lifestyle audit of procurement officers during his tenure led to increased revenue without imposing additional taxes.
“Where the money is coming from and how the money is being spent, that is where there is a problem. The revenue, income tax, VAT customs boys, and procurement officers in the ministries, are the boys in town. They are the ones who are buying apartments in town, driving the latest models in town and building castles in the rural areas. If you do a lifestyle audit, you will catch them.” explained Raila.
Odinga’s call for fiscal responsibility comes amid growing discontent among Kenyans regarding the high cost of living and the government’s continuous implementation of measures that increase taxes on various commodities and services. He criticized the Kenya Kwanza administration for its failure to address the economic challenges faced by citizens and urged a shift in focus towards sealing corruption loopholes and promoting sustainable debt management.
Earlier this month, Odinga emphasized the need for urgent action to address the economic downturn, suggesting a reduction of the government’s operating budget by at least Ksh.500 billion. He called for a review of the taxes imposed by the Finance Act 2023, advocating for tax cuts, production stimulation, fiscal discipline, and realistic debt management to alleviate the economic burden on Kenyans.
During the ‘Transforming a Nation’ conference in Nairobi, Odinga outlined the importance of providing relief to low-income families, particularly those promised upliftment by the Kenya Kwanza administration. He criticized the government’s current policies, which he argued disproportionately affect vulnerable households, leading to increased financial strain.
The opposition leader also took aim at the Kenya Revenue Authority (KRA), accusing it of burdening taxpayers with repressive policy changes while failing to meet revenue targets. He urged the government to focus on addressing corruption, reducing taxes, and implementing policies that promote economic growth and sustainability.
In response to President Ruto’s State of the Nation address, where he assured Kenyans of the government’s commitment to addressing challenges, Odinga expressed skepticism. He noted that Kenyans are worse off than they were 14 months ago, attributing the decline to the administration’s aggressive tax policies. Odinga urged the government to prioritize citizens’ welfare by making policy changes that alleviate the economic burden on low-income families.
“We as Azimio in line with our manifesto advocate for tax cuts, production stimulation, fiscal discipline, and realistic and sustainable debt management to tackle Kenya’s economic challenges.” said Raila, “Urgent action is needed to seal corruption loopholes to stop the looting, nothing less.” Odinga added.
The opposition leader also condemned the ‘Hustler’ narrative promoted by the Kenya Kwanza administration, arguing that robbing the rich and middle class to help the poor is an ineffective approach. He cautioned against the long-term damage caused by the current government’s policies and called for immediate course correction to prevent further economic decline.
In a move reminiscent of his past calls for civil disobedience, Odinga recently called on his supporters to boycott new taxes imposed by President Ruto’s government. The levies, including a doubled fuel tax and a 1.5% housing levy, were signed into law by Ruto to stabilize government finances. Odinga characterized the bill as a betrayal and urged his followers to engage in acts of civil disobedience to protest what he views as an unjust burden on the citizens.
As Kenya grapples with economic challenges and a rising cost of living, Odinga’s calls for fiscal changes and opposition to further taxation set the stage for a renewed political and economic discourse in the country. The government’s response to these calls will likely shape its economic policies and determine its relationship with the opposition in the coming months.