Deputy President William Ruto yesterday opened a new battlefront with his boss President Kenyatta over the 2022/23 Budget, and asked MPs allied to him to reject it.
And should the legislators fail to alter the Budget, the DP promised to dismember it if he wins the State House race in the August 9 General Election.
The DP said the Sh3.31 trillion Budget for the financial year starting July that was recently read in Parliament by Treasury Cabinet Secretary Ukur Yatani was not people-friendly, and only seeks to increase the cost of living.
If the government bulldozes its way and passes the Budget, he said then his government, if he wins the August race, would make changes to the expenditure vote, through supplementary budget proposals.
“You know the Budget was read recently and it seeks to increase the cost of basic commodities such as water, bread, maize flour, and motorcycles. We want to tell them that [the] Budget won’t be passed in Parliament and if it does, we’ll overturn it after three months so that it can be a budget of the common mwananchi,” DP Ruto said.
He was speaking in Karuri, Banana Town in Kiambu County, where he addressed roadside rallies after attending a church service at ACK St Peter’s Muongoiya Church in Kiambaa Constituency.
While presenting the Budget highlights last Thursday, Mr Yatani steered clear of the particular sections of the economy that the government targets to raise its revenue, but it is in the Finance Bill, 2022 that the real intentions became clear.
The Finance Bill shows that the state targets higher taxes on popular products, including motorcycles, cosmetics and beauty products, jewellery, beer, wines and spirits, chocolate, and bottled water to raise an additional Sh50.4 billion for the year starting July.
The excise duty charged on a motorcycle unit will be raised to Sh13,403.64 per unit, up from Sh12,185.16 currently, marking a 10 per cent jump that will impact the affordability of the two-wheelers popular with Kenyans seeking to beat traffic jams in congested towns and cities or tackle difficult terrains in rural areas without good roads.
This marks a double blow for boda boda operators, who have also been included under compulsory third cover insurance, prompted by the rising number of accidents that have left many dead or injured and unable to pay hefty hospital bills.
In the Bill, cosmetic and beauty products, as well as jewellery, are also targeted, with the Finance ministry raising the excise duty on them to 15 per cent from 10 per cent currently.
Bottled water will see a marginal rise on duty charged, with the Treasury proposing to impose a levy of Sh6.60 per litre, up from Sh6.03.
Excise duty on beer, cider, perry, mead, opaque beer, and mixtures of fermented beverages with non-alcoholic beverages and spirituous beverages of an alcoholic strength not exceeding six per cent will attract a tax of Sh134 per litre, up from Sh121.85 currently, indicating a jump of 9.97 per cent.
For wines, including fortified wines and other alcoholic beverages obtained by fermentation of fruits, the state seeks to introduce a higher tax of Sh229 per litre, up from Sh208.20.
The excise duty on spirits of undenatured ethyl alcohol, spirits liquors and other spirituous beverages of alcoholic strength exceeding six per cent will attract a higher Sh335.30 per cent per litre compared to Sh278.70 currently.
These changes, the DP says, are hitting the common mwananchi hard, and need to be reversed.
He has marketed his bottom-up economic approach—the idea of pumping money to the bottom of the economic pyramid—saying it was the best way to spur wealth creation and promote entrepreneurship.
The DP’s team has promised a Sh50 billion kitty for small and medium-sized enterprises.
Lawmakers are expected to approve the budget before their term ends ahead of the August 9 elections.
Tharaka-Nithi Senator Kithure Kindiki, who was among the political leaders that had accompanied the DP in Kiambu yesterday, said the United Democratic Alliance will introduce a supplementary budget after ascending to power that will address the high cost of living perpetuated by the current government.
“When we take over the government on August 9, we are going to bring a supplementary budget to bring down taxes so that the prices of food and commodities can come down,” he said.
Kikuyu MP Kimani Ichung’wah, who was fired from his position as chairman of the parliamentary budget committee for his association with the DP, alleged that the Sh3.31 trillion budget is a burden to many Kenyans who are already struggling.
Besides the taxes, the government rolled out a massive social welfare programme, including Sh39.5 billion allocation to social protection programmes aimed at cushioning vulnerable members of society from poor living conditions.
Slashed export fees
Farmers and herders also won big after Mr Yatani slashed the export fees on raw hides and skins, which had been imposed on the product to discourage its export and promote local value addition.
The DP’s return to Kiambu yesterday comes at a time he is engaging aspirants vying for various seats to step down for popular candidates ahead of the Thursday UDA nominations.
Already, he brokered a consensus deal on Friday between radio journalist Karungo wa Thangwa and Kiambu County Assembly speaker Stephen Ndichu, who agreed to step down for the former who will now vie for senatorial seat in Kiambu under UDA.
On Friday, Mr Ichung’wah, one of Ruto’s closest allies, said consensus talks are still ongoing ahead of nominations.
“Consensus building is a continuous process and we continue to engage at various levels. We are a team that believes in win-win,” Mr Ichung'wah said.