Micha Chebus

Recently, the Kenyan government through the Treasury presented the much-anticipated Finance Bill for the fiscal year 2024/2025 to the National Assembly. The bill is one of Kenya’s strategies to sustain its Bottom-Up Economic Transformation Agenda (BETA), focusing on fiscal consolidation and climate change mitigation to improve livelihoods. This Finance bill elicited a lot of discussion among Kenyans due to the tax measures intended to increase the tax rates and also subject certain new streams of income to tax. With these finance bills, the CS Treasury noted that there are ongoing reforms and additional measures being introduced with the aim of hastening the economic growth which is projected to grow by 5.5% in 2024 and 2025, thus economic growth.

The Finance Bill 2024 is set to play a pivotal role in shaping Kenya’s economic landscape. Here are the key highlights from the Finance bill 2024:

1. Tax Reforms: The bill proposes an increase in Value Added Tax (VAT) on essential goods, which has sparked significant public debate. The government argues that these reforms are necessary to bridge the budget deficit and fund critical infrastructure projects.
2. Incentives for Investors: To attract foreign investment, the bill includes tax incentives for new businesses in technology and manufacturing sectors. This move is expected to boost job creation and enhance technological advancement.
3. Social Programs Funding: Increased taxation is also aimed at funding social programs, including healthcare and education, which are critical for sustainable development.
4. Impact on SMEs: Small and Medium Enterprises (SMEs) will face new compliance requirements, which might pose challenges but also provide a more structured business environment.

Despite, some applaud the government’s effort to stabilize the economy, others express concerns over the increased cost of living and potential burden on low-income households. However, due to the ongoing situations, this bill has raised a group of Kenyans called “GenZ” which sought to fight for their rights by participating in the ongoing protests over the higher cost of living. They argue that the Kenyan government don’t listen to their views before making any policy and so they decided to demonstrate in the streets across the country, particularly in Nairobi City. As the debate continues, it is crucial for all stakeholders to engage constructively to ensure that the bill meets its intended objectives without compromising the welfare of the Kenyan people.