IMF Advices Kenya on the Best Tax Approach. In a significant move following the recent political shake-up in Kenya, the International Monetary Fund (IMF) has called on the government to engage citizens in the development of fiscal policies as the best approach to implementing tax.
This comes a day after President William Ruto dismissed all Cabinet secretaries and the attorney-general, responding to public pressure amid anti-government protests that resulted in the withdrawal of the controversial Finance Bill 2024.
Recently during a press briefing, IMF spokesperson Julie Kozack highlighted the complexities faced by policymakers in low-income countries like Kenya.
She emphasized the need to balance urgent priorities, manage rising debt levels, and enhance domestic revenue. Kozack revealed that the IMF is collaborating with Kenyan authorities to refine their revenue policies, aiming to meet the nation’s economic objectives.
“We remain committed to helping Kenya establish sound macro-economic fundamentals, which are crucial for sustainable growth and job creation, especially for the country’s young people,” stated Kozack.
She stressed the importance of broad public consultation in fiscal policy-making to garner widespread support.
“We are confident that we will be able to find a balanced path forward,” she added.
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The IMF reiterated its primary goal of aiding Kenya in overcoming its economic challenges and enhancing the economic well-being of its citizens.
The global lender emphasized the necessity for prudent, efficient, and effective use of taxpayers’ resources in priority areas to prevent public backlash.
The call for public involvement in tax policy formulation comes in the wake of widespread online protests by Kenyans. The demonstrations were sparked by the IMF’s support for the proposed taxes in the Finance Bill 2024.
IMF Advices Kenya on the Best Tax Approach: A Background
Frustrated netizens took to the IMF’s X page on Monday, June 17, just before Members of Parliament began debating the contentious bill. On June 18, online protesters urged the IMF to cease lending to Kenya, criticizing the institution for negotiating multi-billion loans with President William Ruto.
As Kenya navigates its fiscal challenges, the IMF’s appeal for inclusive policy formulation underscores the need for transparency and public engagement in the country’s economic decision-making processes.
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