Since June 19, thousands of Kenyan youths have protested in major streets against tax hikes in a proposed finance bill by the government. The bill includes new taxes on essential items and services like bread, sanitary pads, and mobile phones, which protesters argue will worsen the already severe cost-of-living crisis.
Named #OccupyParliament and #RejectFinanceBill2024, the protests started in Nairobi and spread to other cities like Mombasa, Nakuru, and Kisumu. The goal is to pressure lawmakers to reject the bill.
This isn’t the first time Kenyans have protested tax hikes. Last year, there were protests against increased taxes on petroleum products, which raised transportation and staple costs.
This year’s protests stand out because they are led by young citizens, those born in the late 1990s and early 2000s. Similar to the Nigerian #EndSARS protest in 2020, what began on social media platforms like TikTok and X (formerly Twitter) turned into street protests with placards saying, “Do not force the taxes on us.”
A protester told the BBC World Service, “I think this will go down in Kenyan history as a time when young people really showed up for a protest.”
By Thursday afternoon, as protests grew both online and offline, the government announced it would remove many of the bill’s most controversial parts, including taxes on bread and car ownership.
“The finance bill has been amended to remove the proposed 16% levy on bread, transportation of sugar, financial services, foreign exchange transactions, as well as the 2.5% motor vehicle tax,”
The Kenya Presidency
Below are some major changes proposed in the Finance Bill:
- Introduction of an Eco Levy on all imported products that harm the environment such as sanitary towels, diapers, motorcycles, tyres, plastic packaging, electronic devices, audio-visual recording equipment, radio equipment, and electronic equipment.
- Change of tax status of ordinary bread, transportation of sugarcane from farms to milling factories, locally assembled mobile phones, electric bikes, solar and lithium-ion batteries, and electric buses from tax-exempt to standard which would introduce a 16% VAT on the items.
- Introduction of a 2.5% Motor Vehicle Tax with a minimum of KES 5,000 and a maximum of KES 100,000. This was later amended to remove the ceiling.
- Withholding tax on payments made for goods supplied to public entities at 3% for residents and 5% for non-residents.
- Increase of Road Maintenance Levy from KES 18 to KES 25 per litre of fuel, which will raise the price of fuel even further.
- Change of tax status for fertilizers, pesticides and fungicides from zero-rated to exempt means that the tax on these items is still zero but manufacturers can no longer claim VAT on these items.
- Introduction of a 25% excise duty on vegetable and seed oils and 5% duty or KES 27,000/tonne on coal (whichever is higher).
- Increase of excise duty to 20% for financial services transactions, telephone and internet services, lottery, betting, gaming, and advertisements on the internet and social media.
Some of the arguments against the proposed finance bill include;
- The introduction of the Eco Levy on finished products would unfairly affect access to sanitary products in a country where over 65% of girls and women experience period poverty and cannot access menstrual hygiene products.
- The introduction of a tax on necessities like bread, diapers, sanitary towels and cooking oil is a cash grab and punitive to the common Mwananchi.
- A motor-vehicle tax and higher fuel prices resulting from the added road maintenance levy would adversely affect the transport sector and increase the cost of living for most Kenyans due to increased transportation and fuel costs.
- Changing the tax status of agricultural implements will increase the cost of food production in Kenya and consequently the cost of food prices.
- Taxes on electric bikes and buses, batteries and solar equipment contradict the Green Economy Agenda currently being pushed by the government through other proposed taxes like the Eco Levy.
Watch this BBC report below:
