Kenya Aborts Tax, Fuel Price Hikes After Deadly Protests Claim 22 Lives

Kenya’s President William Ruto has announced that he will not sign into law Finance Bill 2024 containing controversial tax hikes, including a proposed fuel tax increase after countrywide protests left dozens dead and saw parliament set ablaze on Tuesday. 

In an address to the nation, Ruto said it was clear that Kenyans "...want nothing" to do with the bill. State-funded Kenya National Commission on Human Rights (KNHRC) has reported that at least 22 people were killed amid clashes with the police after the bill was passed by parliament on Tuesday. Protesters broke into parliament, vandalizing the interior and setting parts of the complex on fire. 

“Ruto bows to Gen Z pressure, withdraws Finance Bill,” declared Kenya’s Citizen TV.

The Kenyan legislature came up with the bill in a bid to cut the country’s massive debt burden of more than $80bn, which costs the country more than half of its annual tax revenues to service. 

Among the controversial tax hikes was a proposal to increase the Road Maintenance Levy from KSh 18 to KSh 25 per liter on fuel, a move that would further hike already exorbitant fuel prices. Fuel prices in the country have hit record levels in recent years, with a liter of petrol currently averaging 193.84 shillings ($5.76 per gallon), nearly double the price five years ago. 

The Kenyan government collects more than 40% of the money paid by motorists at the pump as tax after Ruto’s government dramatically increased fuel tax. Earlier in the year, Kenya Revenue Authority (KRA) revealed that it had collected $1.3B in fuel in the final six months of 2023 compared to $1.1B for the entire year in 2022. 

The increased fuel tax income came despite a drop in fuel consumption from 2.4 billion liters for the corresponding period in 2022 to 2.28 billion for H2 2023.

By Alex Kimani for Oilprice.com

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