Breaking News! Raila Odinga criticizes the Finance Bill 2024

“Most of the tax proposals in the Finance Bill 2024 are as insensitive as they are callous.”

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Azimio leader Raila Odinga has issued a strong call for substantial revisions to the Finance Bill 2024, arguing that if enacted in its current form, it would drastically worsen the economic conditions for many Kenyans. In a statement released on Friday, Raila described the bill’s tax proposals as “insensitive and callous,” highlighting their failure to meet essential principles of fair taxation such as predictability, simplicity, transparency, equality, and administrative ease.

Raila underscored that the Finance Bill 2024 is even more detrimental than its predecessor from 2023, which had already introduced heavy taxation that burdened the poor. He pointed out that many Kenyans had hoped for a reduction in their tax load after the hardships faced last year, but the new bill only amplifies these challenges.

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The bill also seeks to end the zero-rating of bread, introducing a 16% tax, alongside a 25% excise duty on cooking oil. Additional taxes include a 16% levy on cane transportation and an Eco tax on items such as diapers. Raila noted that these measures disproportionately target the poor, who are already struggling under the weight of the 2023 tax regime.

He emphasized that these taxes would hit the most vulnerable groups hardest. For example, the tax on diapers would affect families with young children, who often have few alternatives. Similarly, the tax on cooking oil would drive up the cost of prepared food, affecting millions of casual laborers who rely on affordable meals from small eateries.

Raila also warned of the impending collapse of the insurance industry should insurance services be taxed at 16%, and he criticized the proposed Motor Vehicle Tax, describing it as illogical and retrogressive. He explained that vehicles are already heavily taxed in Kenya, with 40% of their cost coming from various taxes, including fuel levies and fees for number plates.

Despite these high taxes, Raila pointed out that public services remain inadequate, and the Kenya Revenue Authority has consistently failed to meet its revenue targets. The proposed new taxes, he argued, would deter investors and inflict further pain on the poor, who desperately need relief.