Post-truth politics a threat to Kenya’s democracy: Part III
In the run-up to the August 9, 2022, General Election, Kenya’s power elite stridently weaponised taxes in the presidential contest.
After the elections, the country witnessed round two of the tax wars. Framing both rounds one and two of the tax wars is the ‘hustler versus dynasty’ narrative.
This third article in the post-truth politics and democracy in Kenya series delves into the second round of Kenya’s tax wars, which has pushed post-truth politics to a fever pitch. It has also increased the risk of stability.
In round one, the dynasties were firmly in power. The hustlers cried witch-hunt. The regime of former President Uhuru Kenyatta, they stated, had weaponised the country’s tax system to silence and force their supporters to defect to Azimio.
Playing victim
The hustlers, however, turned the tables on the dynasties. Playing victim and whipping up grievance politics based on taxes, they sparked a historic revolt against Kenyatta’s Jubilee Party in Mt Kenya.
In round two, the hustlers are in power. Two rival theses are driving the Kenyan debate on taxes.
One is the debt-burden thesis. Upon election, President Ruto blamed the Kenyatta regime for burdening Kenya with a huge debt, estimated at Sh11 trillion.
Perhaps inspired by the Kibaki-era ideal of creating ‘a government of the people, by the people and paid for by the people’, Ruto went into overdrive to replace debt with revenue from taxes to fund the delivery of services and development.
He exhorted all Kenyans to pay their taxes. The Kenya Revenue Authority (KRA) has been reconceived and revitalised as a powerful tool to unlock the huge potential for the economy to fund itself and to reduce the deficit that has occasioned unsustainable borrowing.
The tax agency should reach its target of raising Sh3 trillion to Sh4 trillion in the short term and Sh5 trillion in the long run.
However, the President’s efforts to eliminate tax exemptions and evasions have irked the Azimio leadership.
Context matters. Dr Ruto inherited an economy still reeling from the aftershocks of Covid-19, a prolonged electioneering period and the ripple effects of the ongoing war in Ukraine.
Tax evasion and exemption were the lynchpins of a system of crony capitalism that the Kenyatta state created.
Anchored on privileges and political patronage, this cronyism produced a society of unequal citizens based on unequal taxation.
Big businesses and big landowners were exempted from paying taxes.
State agencies were used to advance the interest of private businesses of the ruling class at the expense of everybody else.
The result was Africa’s most stifling oligopolies where just a few well-connected companies had a vice-like grip over the market.
The regime, Kenya Kwanza pundits posited, was dominated by tax cheaters where those in power were using state instruments to avoid paying taxes.
Ruto’s government has wielded a heavy stick against those it suspected of evading taxes.
Alluding to George Orwell’s satirical book, Animal Farm, he declared that: “The country is not an animal farm where some animals are more equal than others.”
Under investigation
More than 300 companies, which are associated with powerful individuals in the previous government, were reported to be under investigation for tax evasion.
The tax evasion debate put Kenyatta’s business empire in the spotlight. Legislators from the Mt Kenya region called on the taxman to audit and revise the tax status of corporations belonging to his family.
In a letter to the KRA Deputy Commissioner, Nyandarua Senator John Methu demanded a tax audit of properties and businesses owned by the family of the Jubilee Party leader and chairman of Azimio.
This put under sharp scrutiny Kenyatta family’s flagship firms, including Brookside, NCBA, ENKE and Safaricom 5G Deal.
County governments have also initiated audits on land rates paid by the first family on the land they own across the country.
A written petition was filed at the registry of the National Assembly seeking to repeal section 7(3) of the Estate Duty Act Cap. 483 of 1963, which introduced the estate duty levied and paid on all inherited property or assets but exempts the families of Mzee Jomo Kenyatta and Daniel Toroitich arap Moi” from paying estate duty.
In a recent tweet, National Assembly Majority Leader Kimani Ichung’wa called on KRA to check if the alleged hundreds of billions in the Pandora Papers had taxes paid here before being shipped offshore.
The second thesis driving the Kenyan debate on taxes is the ‘the tax burden thesis’.
This has gained momentum in the wake of the crackdown on tax exemptions and evasions. The dynasties have raised alarm bells over the instrumental use of taxes in political battles.
Azimio wonks have weaponised taxes to mobilise anti-Ruto rallies. They have nicknamed President Ruto ‘Zacchaeus the tax collector” whose strict tax reforms have burdened mwananchi with taxes. Ruto’s new tax burden has replaced the Uhuru-era debt burden. His tax dossier has politicised the work of KRA and targeted great families over tax obligation.
The tax wars have radicalised politics, polarised the polity and turned Ruto’s relations with the Kenyatta family increasingly frosty.
“Leaders who have nothing to deliver will always talk a lot and deliver nothing,” Uhuru said.
The former First Lady, Mama Ngina Kenyatta, also broke her silence.
“Paying taxes is a must whether you are big or small,” she declared, accusing UDA politicians of politicising tax matters, “peddling lies” and tarnishing the Kenyatta family name.
In turn, Kenya Kwanza politicians and pundits have accused the Kenyatta family of funding Raila’s protests to arms-twist the government to not pursue the tax debts, arguing that Azimio is shielding influential people from paying taxes.
Amid rising tensions, opposition pundits and donors alike are piling pressure on Ruto to go slow on his “all-must-pay-taxes” campaign and open talks for power-sharing. This is a poisoned chalice for our democracy.
Ethnicity
Notably, ahead of last year’s election, Ruto effectively shifted the axis of political mobilisation in Kenya from ethnicity to economic debate.
What Kenya needs is increased tax collections and prudent and transparent use of taxes to drive development. As the new British Prime Minister Rishi Sunak once observed: “Having a lower tax, the simpler, fairer tax system is something that can drive growth.”
Beyond the polarity of ‘debt burden’ versus ‘tax burden’, Ruto should now attract investments based on privately sourced funds and the Public Private Partnership (PPP) model. BY DAILY NATION



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