Ruto persuades Kenya Kwanza MPs to back his tax measures

President William Ruto on Tuesday rallied MPs allied to his Kenya Kwanza alliance to back his radical tax proposals and public debt plans.

The President's move to whip his MPs to support his agenda came as senators resumed their sittings after a long recess with their National Assembly counterparts expected back next Tuesday.

In a departure from the past, Ruto on Monday brought in experts, including Principal Secretaries and Cabinet members to make MPs better understand his tax proposals and agenda.

Multiple MPs told the Star that the President asked the lawmakers to pass the controversial Finance Bill, 2023 without any changes despite public uproar.

The National Assembly Finance Committee is currently conducting public participation on the bill before it is tabled for MPs approval.

The 2023/24 budget estimates will be presented on June 15.

The push signals a political showdown in the bicameral house with opposition leader Raila Odinga having warned of mass action if the bill is passed without changes.

The opposition has claimed that the bill is proposing more taxes for Kenyans to raise revenue for the government despite the skyrocketing cost of living.

After Monday's Kenya Kwanza Parliamentary Group (PG) meeting at State House, the president stressed why his tax proposals must be passed in totality.

"We were taken through the tax proposals and after that, I think my colleagues and I were more than convinced to pass the Finance Bill,'' said a UDA MP who attended the daylong meeting.

This means that lawmakers will push through the controversial 16 per cent VAT on petroleum products amid fears it will trigger an increase in the prices of basic commodities.

It also emerged that the State House meeting looked at the debt ceiling with Ruto pushing to get borrowing headroom to finance his ambitious Sh3.6 trillion 2023/24 budget.

"Certainly, we were taken through the debt management plan and agreed that we will give the government more space to get some money from partners,'' said another MP.

The Cabinet has already given the nod to the National Assembly to move the debt ceiling from the current limit of no more than Sh10 trillion to a new debt anchor set at 55 per cent of Gross Domestic Product.

MPs are expected to pass the ceiling to give Ruto's government space to go for more loans to finance development projects.

Top on the agenda during Tuesday's meeting was also highlights on the proposed three per cent housing levy to finance Ruto's affordable housing plan.

The President has proposed that employees pay three per cent of their basic salary while their employers will match the amount to finance the housing plan despite opposition.

During the meeting, Housing PS Charles Hinga gave a presentation on the Housing Fund, debunking myths around it and insisting that the monthly contributions will not exceed Sh2,500 for each employee.

He told the MPs that 97 per cent of Kenyans cannot afford a house, saying the new Housing Fund will accord them a chance to own homes.

The meeting also looked at the 35 per cent income tax on workers earning over Sh500,000, internet connectivity and greening the economy. 

In a move to entice the MPs to pass his proposals, Ruto said he will inject additional funds into the National Government Constituency Development Funds for the tree planting programme.

Environment, Climate Change and Forestry Cabinet Secretary Soipan Tuya took the MPs through the President’s agenda to increase the country’s forest cover by planting 15 billion by 2032. 

MPs are expected to work with primary schools in their areas to plant more trees under the proposed programme.