Kenya Kwanza Options

When the Kenya Kwanza government took power in August 2022, they kept on reminding us that they found empty coffers. During the same period, the president and his team have been making foreign trips debunking their narrative. As they do this, they keep on reminding us that they are trying to mend Uhuru’s messes. Ruto was a co-president during the first term and it was during this period, that the country experienced massive looting. A Kenyan, who identifies himself as Luis Leakey has advice to the government. In a WhatsApp post, he proposes five titbits that the government can adopt to avoid burdening Kenyans with hefty taxes.

When you enter a house full of debts, you do not engage in activities that increase your debt. Despite the increasing debt, access to services is still wanting, and the members of the household cannot see what the money is doing. As the debtors push you to repay, your first landing place is asking them to pay more taxes. These higher taxes come at a time when you have frozen employment, and the cost of basic commodities has gone high. What options do the people have when in such a situation? yes, your guess is as good as mine; the people will revolt. A revolt not led by any politician or notable person, but by a dejected youth, whose cry is for the government to make life affordable.

So instead of putting more burden on the common mwananchi, the government should have considered doing the following:

Kenya Kwanza Should Reduce Expenditure and Wastage

In a post in February this year, BBC termed President William Ruto and Nigeria’s President Bola Tinubu the flying presidents. After nine months in office, President Tinubu had spent 71 days abroad. His Kenyan counterpart had spent 33 days more, making it 104 days outside the country. In 20 months, President Ruto has made a total of 62 visits to 38 countries. The recent travel was to the G7 summit in Italy, and it followed his other visit to South Korea. According to the controller of budget, by February Kenya had spent $9.2m on domestic and foreign travel. This amount exceeded the budgeted amount for the previous year by 30%. The government should reduce its expenditure (travel, luxuries, hospitality, wastages, and avoid hiring CASs).

Kenya Kwanza Should Complete All the Unfinished projects

Most of the ongoing projects by the previous regime have been put on hold, as the new regime starts new ones. The government should prioritize completing the ongoing projects before starting any new ones. The housing project, the proposed Nairobi-Mombasa expressway, among others should be put on hold until the ones already started are complete.

Do Not Over-Tax

Overtaxing scares away investors and discourages local production. It has been proven that high taxes do not always lead to high revenue collection. On the contrary, it leads to low revenue collection because of poor compliance and negative effects on businesses. Arthur Laffer’s theory suggests that taxes could be too low or too high to produce maximum revenue. Laffer argues that both 0% and 100% income tax can generate $0. It further suggests that tax cuts have arithmetic and economic effects. Economically, the effect is longer and has a multiplier effect. A tax cut increases income for taxpayers, who will then spend it. The increase in demand creates more business activity, spurring an increase in production and employment.

Develop a Systematic Tax Plan

Taxation is the primary means by which governments generate revenue for the public, which allows them to invest in human capital, infrastructure, and the provision of services to their citizens and businesses. Because of the current economic times in the Country, there has been a need to increase revenue collection. The Kenya Kwanza government proposed tax measures last year (2023), and the recent one, both of which elicited anger among Kenyans. To avoid such a revolt, the government should have a systematic tax plan that is spread over a considerable period.