John Mbadi, the nominee for the National Treasury and Economic Planning Cabinet Secretary, has stated that Kenya does not need a Finance Bill to sustain its revenue collection. During his vetting by Parliament’s Committee on Appointments on Saturday morning, Mbadi addressed concerns about the withdrawal of the Finance Bill 2024, asserting that the country still has viable alternatives.
Mbadi emphasized that the government’s ability to generate revenue does not hinge on the reintroduction of the Finance Bill, which was widely rejected by the public. He pointed out that many of the proposals within the bill that were not contested could be reintroduced as standalone legislation, thereby avoiding the contentious provisions that were perceived as overly burdensome by Kenyans.
“The Finance Act 2023 has been declared unconstitutional, although that has been appealed. Still, we don’t have a lacuna,” Mbadi noted. “In fact, the Finance Bill is an omnibus Amendment Bill that usually amends about five or six legislations, including Excise Duty, Import Duty, Value Added Tax, Income Tax, the Tax Procedures Act, and various fees and levies.”
Mbadi highlighted that these specific legislations could be brought back to the House for individual consideration and amendment. This approach, he argued, would ensure proper public participation and allow for the beneficial provisions of the Finance Bill to be retained without the less popular measures.
“This House, if I’m approved, should help me to bring these legislations directly, touching on these specific statutes,” Mbadi said. “We don’t have to have a Finance Bill, but I’ll seek guidance from the Attorney General. I believe the good provisions which have been lost by this Bill, which are not contentious, can still help grow this country’s economy. We can bring them as specific amendments to those Acts with proper public participation.”
One of the major criticisms of the Finance Bill 2024 was the perceived lack of adequate public participation. Mbadi acknowledged this issue, stating, “I think the problem we had was that the public felt there was no proper public participation, which we had, but maybe they felt they were not listened to.”
Reassuring the public, Mbadi cited past instances when Parliament passed the Finance Bill later in the year without adverse effects on the country’s financial stability. “On the Finance Bill that has been lost, I want to tell Kenyans, please don’t panic. Let us stop making Kenyans panic,” he said. “In the 10th and 11th Parliament, the Finance Bill used to be passed in September. We used to have three months into the financial year to pass the Finance Bill.”
Mbadi explained that interim taxes could still be collected through a revenue collection order, allowing the government to continue functioning smoothly. “The minister then was allowed by law to allow for some interim taxes to be collected. The bottom line is that the law could be in place on September 30th. So there is no cause for alarm.”
In conclusion, Mbadi’s statements aim to reassure the public and the business community that the withdrawal of the Finance Bill 2024 does not signal a crisis. Instead, it presents an opportunity to reintroduce beneficial provisions through separate legislations with enhanced public participation. This approach, Mbadi believes, will help restore Kenya’s economic stability and ensure that the government can continue to collect revenue effectively.
