Nairobi: Kenya’s government on Tuesday scrapped plans to introduce several tax hikes, reversing a controversial law that sparked protests in which hundreds of protesters were arrested.
East Africa’s economic powerhouse has been struggling with a cost-of-living crisis, and critics have warned that the bill, which will be debated this week and passed before June 30, will make the charges worse.
Hundreds of mostly young protesters gathered near the Assembly on Tuesday and police fired tear gas, according to AFP reporters. The KNHCR Human Rights Commission said 335 people were arrested.
A few hours later, the president announced that he would repeal some of the bill’s most controversial provisions, including the bread and car ownership tax.
“The Finance Bill has been amended to eliminate the proposed 16 percent tax on bread, sugar transportation, financial services, currency transactions, as well as the 2.5 percent car tax,” the president said in a statement.
“Furthermore, there will be no increase in mobile money transfer fees and excise duty on vegetable oil has also been removed,” he said.
The cash-strapped government has maintained a forecast of 346.7 billion shillings ($2.7 billion), equivalent to 1.9 percent of GDP, as a necessary measure to reduce dependence on external debt.
Lawmakers were due to debate the bill on Tuesday evening, but the president postponed the debate until Wednesday before announcing the changes following recommendations from a parliamentary committee.
