The Kenyan government is seeking to generate around $1.2 billion by reintroducing certain taxes that had previously been dropped due to public outrage and violent protests, according to Finance Minister John Mbadi. President William Ruto had earlier withdrawn the controversial tax hikes in June, following intense street demonstrations in Nairobi, where protesters stormed parliament and police responded with live ammunition.
Now, the government is considering about 49 different tax measures to fill the funding gap, including a revived “eco levy” on items like electronic goods and plastic packaging. The aim of this levy is to encourage environmental responsibility by making those who contribute to pollution pay for mitigating the damage. “If you harm the environment, you should contribute to fixing it,” Mbadi emphasized during an interview on Citizen TV.
Mbadi, who was previously an opposition leader, is now part of President Ruto’s expanded cabinet. This move to include former opposition figures is part of Ruto’s strategy to build a more inclusive government and address the grievances of protesters, many of whom are young Kenyans.
The decision to abandon the 2024 finance bill, which was expected to bring in $2.7 billion in revenue, forced the government to cut spending and increase borrowing to manage its finances. The new tax measures, expected to be implemented by the end of September, are part of an effort to stabilize the economy. However, the earlier decision to scrap the finance bill led to downgrades from global ratings agencies, Moody’s and Fitch, which raised concerns about Kenya’s ability to manage its $78 billion public debt.
