Gideon Moi Warns Ruto’s Finance Bill Will Impoverish More Kenyans

June 12, 2024

On Tuesday, Kanu party leader Gideon Moi warned that President William Ruto’s tax proposals contained in the Finance Bill 2024 will push more Kenyans into poverty.

The former Baringo senator noted that economic experts and the general public have highlighted the Bill’s pain points. He cautioned that, if enacted in its current form, it will disproportionately reduce Kenyans’ purchasing power by cutting into their disposable incomes.

“Therefore, the National Assembly Finance and Planning Committee must ensure that its final report reflects the opinions, concerns, and aspirations of Kenyans on the Bill,” Moi said.

Gideon Moi said the National Assembly holds the key to amending the Bill and alleviating the burden of over-taxation on Kenyans.

Moi mentioned that the committee has an opportunity to redeem itself from the “superficial” public participation exercises it conducted in the 2023/2024 financial year, where public input was largely disregarded in the final report presented to the National Assembly.

He asserted that the government’s approach to aggressively exacting tax beyond the point of elasticity during an economic downturn will inevitably reduce tax revenue.

“The Finance Bill, 2024 will be self-defeatist as evidenced in the National Treasury’s report in May that KRA fell short of its projected tax revenue collections,” Moi opined.

Moi highlighted the proposal to impose excise duty and VAT on essential financial services, stating it contradicts the country’s goal of financial inclusion to combat poverty and inequality.

“Many Kenyans rely on services like Mpesa to transfer money to their dependents for their basic needs. It is a dent in our national conscience to erroneously treat these transfers as taxable incomes,” he added.

Gideon Moi advised the government to shift its focus from taxation to industrialization through manufacturing to achieve sustainable, private-sector-led economic growth.

“With value addition, more jobs will be created across the value chain, reducing unemployment and creating more incomes, effectively expanding the tax base and increasing tax revenue to fund public programs,” he explained.

He emphasized that the government must work on improving the ease of doing business, simplifying tax regimes, and combating public-sector corruption.

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