On June 26, 2023, the Kenyan president, William Ruto, passed the Finance Act 2023. The Finance Act introduced various measures and amendments to the Income Tax Act, Value Added Tax (VAT) Act, and Excise Duty Act. The aim was to broaden tax capacity and stabilize debt. Following the enactment of the Finance Act, there has been an increase in living costs, being a knock-on effect of the rise in VAT on petroleum products from 8 percent to 16 percent. Additionally, there are massive job losses as employers revert to laying off staff to meet increasing operating costs. The aftermath will not only erode citizens’ standards of living but also curtail their economic freedom. The adverse effects of the Finance Act 2023 demand that the government rethink its revenue mobilization measures by reviewing its tax expenditures policy. Additionally, the Kenyan government can more effectively foster revenue collection through proper governance and an improved business environment.
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