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Kenyans reject the Finance Bill 2024 amid economic hardship and repression

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Police heavily repressed the protests against the Finance Bill 2024 on Tuesday June 18. Hundreds were arrested and brutalised in Nairobi by police forces during protests against the government’s finance bill, the writer says. Picture: Mathare Justice Centre

By Nicholas Mwangi

On Tuesday June 18, the streets of Kenya’s capital were the site of a major showdown, as peaceful protesters advocating for the rejection of the Finance Bill 2024 were met with brutal repression by state forces.

According to human rights groups in Kenya, between 300-400 protesters were arrested as they rallied against the punitive tax measures proposed by the government. The protest organised by a wide variety of civil society organisations and left groups was violently disrupted by police forces attempting to prevent the demonstrators from reaching the parliament building, where organisers had planned to launch a sit-in at 2 pm.

Despite the heavy-handed police attacks with water cannons, and tear gas, the protesters persisted throughout the day, ensuring their voices were heard by those in power and not allowing their right enshrined in article 37 of the constitution – “assembly, demonstration, picketing and petition” to be compromised.

This article outlines that every person has the right, peaceably and unarmed, to assemble, to demonstrate, to picket, and to present petitions to public authorities.

The tension and public dissent exerted considerable pressure on the government. This was evident as President William Ruto convened an early meeting with members of parliament. The outcome of this meeting saw some “compromises” in the government’s stance on the contentious finance bill.

The parliamentary finance committee announced the government’s U-turn at a press briefing on Tuesday, attended by the president and ruling party lawmakers. They announced the decision to withdraw certain proposed taxes, including those on cooking oil, mobile money services, and motor vehicles. The concession was clearly a direct response to the mounting public outcry nationwide.

However, the selective removal of these taxes has done little to appease the masses. Many view it as a strategic move by the government to placate the population while still pushing through other unpopular measures. The finance bill of 2024, in its entirety, remains widely rejected by the masses. The protesters’ message is clear: they demand a complete overhaul of the proposed financial policies, not just a piecemeal reduction of specific taxes.

Ruto’s neoliberal Finance Bill

The Finance Bill 2024, much like its predecessor in 2023, has stirred controversy and discontent across Kenya due to its stringent and, many argue, draconian proposals. This widespread dissatisfaction is deeply rooted within the broader context of an already high cost of living, which will be increased by the proposed new taxes.

Beginning last week, Kenyans have voiced their disapproval with the finance bill by taking to social media, where they posted the contacts of members of parliament (MPs) and encouraged each other to reach out to their leaders, urging them to reject the bill.

The Finance Bill 2024, officially published by the National Assembly on May 9, 2024, outlines the Government of Kenya’s proposed tax measures for the financial year 2024-2025. Among the numerous changes proposed are significant amendments to income tax, value added tax (VAT), and excise duty, as well as modifications to the administration of taxes in Kenya.

One of the most contentious proposals in the bill is the imposition of a 16 percent Value Added Tax on financial transactions, and among basic commodities.

Many protested as they believe this will worsen their financial hardships rather than alleviate them. The protests are set to continue, with the third round of parliament scheduled for June 20.

The government’s justification for raising taxes, claiming it is necessary for Kenya to live within its means, is hypocritical given its extensive and often unnecessary expenditures. For instance, the government has increased its borrowing target for the fiscal year starting in July to Sh597 billion, a substantial sum that raises questions about fiscal responsibility. A closer look at government spending reveals significant outlays that contrast sharply with its message.

According to Business Daily, the latest budget control data show a significant rise in travel perks for foreign and local trips, with an increase of Sh1.62 billion from the Sh12.4 billion spent in a similar period the previous year.

The Parliamentary Service Commission’s spending has also surged by 18.5 percent to Sh1.86 billion, and the bill for MPs has grown by 4 percent to Sh4 billion. Such figures highlight a pattern of lavish expenditure that stands in stark contradiction to the government’s narrative of financial prudence.

Further, the bill has received backing from the International Monetary Fund (IMF), despite widespread public outcry against it. This support from the IMF is not surprising as they did the same last year, and many Kenyans feel that the country has been effectively mortgaged to the institution.

Historically, the IMF’s involvement has brought about economic policies and austerity measures that are seen as an attack on the working class and the marginalised peasants alike, often leading to increased economic strain for the average citizen.

Organised resistance poses more serious challenge to government

What distinguishes the current wave of protests from previous ones is the nature of their organisation. Unlike past protests that were primarily mobilised by opposition party leader Raila Odinga against the government, these demonstrations have been driven by different organisations and particularly on online platforms, which have successfully translated their digital activism into tangible, on-the-ground action.

This movement has seen an unexpectedly high level of participation from “Gen Z” and the middle class, groups that have traditionally been less involved in these demonstrations.

As the protests continue, the Kenyan government will continue to face mounting pressure to address the economic concerns of the masses. In the last two months there have been three major protests organised by grassroots movements among them against state demolitions on the informal settlements of the downtrodden coming to terms with the recent flood crisis that killed many and destroyed properties of unknown value. The fight for total liberation continues.

Nicholas Mwangi is a member of the Ukombozi Library in Kenya