Protest set for Tuesday as pressure mounts for MPs to reject Finance Bill

Pressure is mounting on legislators to reject the proposed Finance Bill, 2024, with a planned protest outside parliament buildings on Tuesday when business resumes after the long weekend.

The organisers of the protest, dubbed "Occupy Parliament," have called on participants to show up in black at noon to keep vigil as Members of Parliament vote at 2.30 pm on the bill that has been widely rejected as punitive.

Citizens, businesses and corporate leaders have termed it a move to worsen the already tough economic times.

The bill proposes a wide range of new levies ranging from a value-added tax (VAT) on bread, a 16 per cent increase in VAT on financial transactions and taxes on motor vehicles, with Kenyans complaining of over-taxation.

Multiple groups have rejected the bill in memoranda to parliament, with producers of consumer goods saying it threatens to push the rising cost of living as they will be forced to increase the prices of their products to cope with tax demands.

The Kenya Bankers Association (KBA) said in a statement that the bill introduces VAT on various financial services, including issuing credit and debit cards, telegraphic money transfers, foreign exchange transactions, cheque handling, and more.

KBA Chief Executive Officer )(CEO) Raimond Molenje noted that it has long been held, and rightly so, that while the VAT applies to payments for goods and services, bank charges are not a direct payment for anything but a cost recovery.

"The increased cost of banking to customers will hamper financial inclusion efforts, particularly affecting low-income individuals and small businesses. Coupled with excise duty, the total taxation on financial services would reach 40 per cent, from the current 15 per cent (excise duty only), significantly impacting affordability and accessibility," Molenje said last month.

The Kenya Muslims National Advisory Council (KEMNAC) has also criticised the bill, saying it is worse than the previous one and that, if passed without amendments, will overburden Kenyans, who are already grappling with the high cost of living.

Last week, KEMNAC Chairman Sheikh Juma Ngao said MPs who support the bill should be voted out in the next general election.

"MPs should set aside their political differences and vote out the Finance Bill, 2024, because the document proposes very high taxes. The bill is worse than the 2023–2024 one," Ngao told journalists in Mombasa.

Under the Okoa Uchumi umbrella, civil rights groups said passing the bill means placing many lives at risk.

Annette Nerima, programme manager at the Kenya Human Rights Commission (KHRC), said, "The Finance Bill, 2024, proposes harsh, unjust taxes, worsening the burden on Kenyans. It targets every aspect of life, travel, communication, and banking without improving services. This is a non-citizen-focused budget."

While presenting the 2024–2025 budget. Treasury Cabinet Secretary Njuguna Ndung'u asked parliament to adopt the tax measures in the finance bill to help raise revenue to pay the country's debt, which he said is Sh11.2 trillion.

Diana Gishengo, Kenya's executive director of The Institute for Social Accountability, questioned the government's spending and borrowing amidst the rising debt levels.

"Surely we do not have a revenue problem whatsoever. The problem is in how the government utilises the money. Whereas the fiscal deficit in the budget has gone down, in terms of prudence we are not yet there," she said.

"There is still a lot of waste, and we are not seeing tightening at that particular level. The government still borrows extravagantly and yet debt is just deferred taxation."

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