Ruto explains why he has been taxing Kenyans
President William Ruto has staunchly defended his Value Added Tax (VAT) system, asserting that it has successfully mitigated the country’s risk of debts and loans.
During the Jamhuri Day celebrations on December 12, 2023, President Ruto emphasized the positive impact of his tax strategies on Kenya’s financial stability.
“The nation is now not at risk of debts and loans as it was before,” declared President Ruto during the 60th-anniversary celebration of Kenya’s self-independence.
President Ruto credited his administration, Kenya Kwanza, for implementing effective strategies that, according to him, have lifted the country from the precarious position it was in regarding loans.
He specifically referred to continuous taxation on basic commodities as part of these strategies.
Notably, a few months after assuming office in September 2023, President Ruto increased VAT on petroleum products from 8 percent to 16 percent, contributing to a surge in the cost of living.
Additional tax fees, such as those related to the affordable housing plan, have been introduced during his tenure.
Also read: Facebook and Instagram to start paying Kenyan content creators – Ruto
Despite the assertion of reduced debt risk, Kenya’s current debt stands at over Sh10 trillion, with a significant portion being foreign debts.
President Ruto’s statement on debt management has raised eyebrows, especially considering that his government continues to borrow.
In the last eight months, the Kenya Kwanza government has borrowed Sh1.2 trillion, surpassing the borrowing pace of his predecessor, Uhuru Kenyatta, during the same period.
Data from the National Treasury reveals that Uhuru’s government borrowed Sh437 billion in the first 12 months of his last term.
President Ruto, who assumed office in 2022, inherited a challenging economic situation, as acknowledged by his deputy, Mr. Rigathi Gachagua, who stated they took over a dilapidated economy.