Raila warns of return to mass action should Finance Bill pass
Azimio Party leader Raila Odinga addressing participants during the presentation of the Finance Bill 2023 by the Azimio Economic Council at the Jaramogi Oginga Odinga Foundation (JOOF), Nairobi on June 8, 2023.
Azimio la Umoja One Kenya Coalition Party leader Raila Odinga yesterday outlined what he termed as his “final objection” to President William Ruto's revenue-raising measures contained in the Finance Bill 2023, warning of nationwide mass action should he force the bill through the National Assembly.
Addressing journalists at the Jaramogi Oginga Odinga Foundation in Nairobi yesterday, Mr Odinga said Opposition MPs were under instruction to vote against it in its entirety.
The Azimio economic council, chaired by former Laikipia Governor Ndiritu Muriithi sought to debunk the Finance Bill, with Mr Odinga calling it a “disease that cannot be cured with everyday herbs.”
“This Bill is economic sabotage. If Ruto insists on this Bill, this country will go into full recession. This Bill requires and must get fierce resistance,” the Orange Democratic Movement (ODM) leader charged.
He said no sane leader withdraws subsidies on basic goods and then increases taxes on the same goods and salaries of working people, including hawkers.
Mr Odinga cited proposed taxes on table-banking initiatives colloquially called chama groups, increased National Hospital Insurance Fund (NHIF) and National Social Security Fund (NSSF) deductions, the housing levy, increased turnover tax for businesses, tax on content creators and social media influencers, a 316 per cent tax hike on beauty products, 16 per cent VAT on basic commodities like maize and doubled VAT tax on fuel.
He also took issue with the proposals in the Bill to expose pharmaceuticals and medicaments to taxation by removing them from the zero-rated to tax-exempt status, advance tax on motor vehicles, introduction of a 16 per cent VAT on insurance compensation and 30 per cent income tax on per diems.
Housing Fund tax
He warned that the Housing Fund tax would increase business operating costs and force firms to relocate.
He questioned why the President was pushing increased taxes for small businesses and chama groups while, at the same time, planning to scrap VAT on aeroplanes and helicopters.
From left: Former Murang'a Governor Mwangi Wa Iria, Prof. Herman Manyora, Azimio Party leader Raila Odinga and National Assembly Minority leader Opiyo Wandayi after attending the presentation of the Finance Bill 2023 by Azimio Economic Council at Jaramogi Oginga Odinga Foundation (JOOF), Nairobi on June 8, 2023.
“Hard-working youth seeking to eke a living as content creators and social media influencers for fun, fame and money are being slapped with a punitive 15 per cent withholding tax and at the same time, Ruto wants to impose a 316 per cent tax hike on beauty products such as wigs, false beards, eyelashes, human hair and artificial nails, among others.”
“The beauty industry is a major employer, particularly of our women and girls who have been unable to find work elsewhere. Millions of young men and women eke a living out of salons, spas and barber shops. Those businesses face closure and others will have to sack employees should this punitive Bill be approved,” he warned.
“Despite existing high prices, Ruto wants to impose 16 per cent VAT on maize flour, cassava flour and wheat flour. It gets worse when we factor in the proposal to expose agricultural pest control products, transportation of sugarcane, raw materials for fertiliser manufacturing and fertiliser to VAT. The net effect is that costs rise again,” he says.
Mr Odinga also protested against plans to expose pharmaceuticals and medicaments to taxation by removing them from the zero-rated to tax-exempt list, saying, the high cost of healthcare has impoverished millions of Kenyans.
“Targeted are the price of life-long medication like insulin and those for chronic illnesses like diabetes and hypertension,” he said.
He raised a red flag over the imminent increase of bus fares should the bill sail through, warning that the proposed advance tax on passenger vehicles will increase from the current Sh2,400 to at least Sh5,000 and from Sh3,000 to at least Sh5,000 for commercial vehicles.
“Trucks will now pay at least Sh60,000 annually, up from Sh20,000. Obviously, the cost will be passed to the consumer, making matatu and taxi transportation more unaffordable,” Mr Odinga said.
He pointed out that, should the vehicles end up in any form of accident, it will be a double tragedy to vehicle owners as the bill proposes to treat insurance compensation as income and introduce a 16 per cent VAT on it.
Wiper leader Kalonzo Musyoka said the coalition’s troops in the National Assembly are ready to deal with the Bill during voting and subject it to the court of public opinion should Kenya Kwanza force it down the throats of Kenyans.
Nark-Kenya leader Martha Karua accused the government of waging an “economic war” on Kenyans.
She warned President Ruto against showing Kenyans the “contempt card.”
Jubilee Secretary-General Jeremiah Kioni said citizens, who are already overburdened, are just waiting for Azimio to call for protests after the passage of the Bill.
